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Chinsegut Hill 


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From the Library of 

Raymond and Margaret Dreier 


University of Florida 

Brooksville. Florid;) 




Digitized by the Internet Archive 
in 2013 


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zA Qase "Book 











First Edition 




Copyright, 1939, by the 
McGraw-Hill Book Company, Inc. 


All rights reserved. This book, or 

parts thereof, may not be reproduced 

in any form without permission of 

the publishers. 



The change of scale in business and industrial operations in 
this country during the last fifty years is a striking fact that has 
been generally observed, but some of its social, as distinguished 
from its economic, implications have not received the attention 
that they deserve. During this relatively short period, many 
business enterprises have passed from the scale of the owner- 
manager, directing ioo or 200 workers and selling to a small num- 
ber of customers, to corporations that number their owners 
(stockholders) by tens of thousands, their managers by hundreds, 
their workers by tens of thousands, and their customers (who are 
for practical purposes unknown to them) by hundreds of thou- 
sands. In its early stages this change of scale, which was often 
achieved by combining several competing firms, caused widespread 
alarm and produced antitrust or antimonopoly legislation designed 
to prevent the abuses that were predicted. In the first decades of 
this century, for example, President Theodore Roosevelt embarked 
upon his famous " trust-busting'' campaign, in response to an 
insistent popular demand. But looking back at it thirty years 
later, the results were certainly disappointing, and one is tempted 
to suggest that the statesmen and lawmakers of that period 
failed to make a correct diagnosis of what they assumed to be an 
industrial disease. 

The observed symptom was a keen desire among competing 
firms to combine in order to eliminate (or at least to mitigate) the 
barbarities of free competition as practiced during the years of 
depression from 1893 to 1898. During the early years of recov- 
ery from this depression, combinations (in the form of trusts or 
by direct consolidation) swept the country like an epidemic. But, 
as we now know, most of these combinations contained in them- 
selves the seeds of their own destruction and would have died an 
early death even if Mr. Roosevelt and his antitrust campaign had 
never been heard of; while the growth of those that were not cori- 
genitally diseased was practically unaffected by the antitrust law 
or by the sound and fury of the trust-busting campaign. This 


interesting fact prompts the suggestion that the sudden appear- 
ance and rapid growth of these great organizations was not 
a disease at all but a response to a natural law, namely, 
that the size of the unit of production, or distribution, is a function 
of the market that it serves. Big markets automatically pro- 
duce big units. Mass production and mass distribution have 
developed in the United States more rapidly than elsewhere, not 
on account of the genius, or the greed, of our business leaders but 
because with the development of modern transportation this 
country offered the largest free market in the world. In other 
words, the tendency toward integration into large units, which has 
been so marked in some industries, is merely an adaptation to 
environment. These large units are not bad in themselves; they 
are, in fact, necessary to sustain our present standard of living. 

On the technical side, these large-scale operations have been 
developed with great skill. Inventive genius of a high order has 
been enlisted in their service, so that many of them are today 
marvels of mechanical and organizing genius. But, while we 
have been focusing our attention on the mechanical and technical 
aspects of industry, we have all but forgotten that industry is car- 
ried on by men and women and that "a business organization is a 
system of cooperative effort." (I have stolen this phrase from 
the owner of one of the best brains I know.) Now the change of 
scale that has taken place completely changes the conditions 
under which these men and women work, and I suggest that our 
failure to grasp this obvious fact and to act upon our knowledge is 
the cause of many of our present troubles. 

We have been fussing and fuming about the economic aspects 
of this gigantic change of scale, and we still are. But today the 
most serious aspect of this change is not its economic but its social 
implications. These have been disregarded to an extraordinary 
degree by statesmen, labor leaders, businessmen, and teachers 
alike. Although the sole function of business is to serve society, 
we have gone blindly forward for half a century under the pres- 
sure of economic forces without giving adequate consideration to 
the effect on our society of the new economic structures that we 
were engaged in building. 

Let us look at this aspect of large-scale industry for a moment. 
One good look will be enough to disturb the most callous. Take, 
for example, a producing and marketing industry employing, say, 


50,000 men and women at eight or ten different locations. Such a 
business will require $50,000,000 or $100,000,000 of capital, pro- 
vided by perhaps 25,000 stock- and bondholders. Its manage- 
ment organization, taken as a whole, will be comprised of 500 to 
1,000 individuals. It will have tens of thousands of customers 
scattered all over the world (but mostly in this country) to whom 
it may make several millions of separate sales a year. 

Now just contrast the position of a high executive in this firm 
with the owner-manager of a textile mill or a machine shop employ- 
ing 100 or 200 people forty years ago. The difference is stagger- 
ing. In place of the firsthand knowledge of markets, customers, 
and workers of the owner-manager, the high executive of such a 
large concern must substitute abstractions, for it is impossible 
for the human mind to deal with such multitudes of isolated facts. 
They must be simplified, arranged in some order or pattern, and 
reduced to abstractions by experts. The high executive must 
abandon the world of reality because of its multiplicity and retire 
to the world of abstractions because of its simplicity. 

This technique of management has not been arrived at by 
theorists but has been learned in the hard school of experience. 
We are all familiar with the fate of businessmen who during the 
period of change from small- to large-scale operations tried to 
stick to the methods with which they were familiar and "attend 
to the details of the business themselves." Those who refused to 
delegate the details of the business to specialists who could reduce 
them to abstractions were ruined. We seem to have demonstrated 
pretty clearly that a businessman who is unable or unwilling to live 
in a world of abstractions is unfit to manage large-scale business 

It is impossible within the scope of this preface to discuss the 
world of abstractions in which the high executive must live. But 
we can name a few of the abstractions : 

1. The balance sheet: a pure abstraction, useful for summariz- \ 
ing certain information. But if you are naive enough to suppose 
that the total of the assets as shown on the balance sheet repre- 
sents the value of the business after the liabilities are subtracted, 
you have another guess. The figures shown on the balance sheet ( 
give almost no clue to the value of the business at any particular time. \ 

2. The earnings statement and profit and loss account: again 
a pure abstraction; for if you begin to ask questions about the 


items you will soon find that most of them represent the judgment 
of some person or persons unknown — perhaps unknowable. 

3. The inventory. In a concern of the size we are considering 
the total inventory may be valued at several million dollars and 
will consist of many millions of items in many different places. 
Could a high executive see that inventory? Certainly not, if he 
continued to be a high executive. 

4. The pay roll: sheets of names and figures at several different 
plants. You can see the pay-roll sheets, but not the pay roll in 
the sense of $25 or $30 a week paid to Rufus Jones, a die caster, 
struggling to bring up five motherless children. 

We could go on indefinitely, but it is unnecessary. In large- 
scale industry with its multitudes of concrete facts that have no 
meaning for the administrator until they have been arranged and 
simplified, it is almost impossible to deal with anything but 
abstractions. And yet these industries are operated by and for 
the benefit of individuals — unique human creatures who were 
formerly known and dealt with as such when the scale of opera- 
tions was small. 

The plain and ugly fact is that the change of scale in modern 
industry has put an almost insurmountable barrier between the 
higher executives and the workers. This is the situation that 
should disturb — I had almost said appall — us; and the gulf 
between management and the customers is of the same order. It 
is not, I think, too much to say that, if large-scale business cannot 
within a relatively short time find some way to remedy this 
situation, we may expect our society to conclude that, in spite of 
its economic advantages, large-scale business has such social 
defects that it is of doubtful value. 

The situation is serious and even alarming, but not necessarily 
disastrous. It will become disastrous only if the men who 
manage large-scale enterprises are either unwilling or unable to 
solve the complicated social problems that they themselves have 
created. Today that assumption is not warranted. Solving 
problems is what business executives are for. They have shown 
genius of a high order in solving mechanical, engineering, and 
organization problems. Whether they can deal with social 
problems remains to be seen. But that they must solve them 
there can be no doubt, for today the high executive is in the posi- 
tion of "a pilot flying blind," and the instruments by which he 
guides his course are the abstractions of which a few have been 


suggested. But frankly they are not adequate, for they cannot 
be applied to the human relations that are the essence of all our 

Unless the managers of large-scale business can produce social 
inventions on a scale comparable with that on which they 
have produced mechanical inventions, the increasing instability 
long observable in our economic structure will end in collapse. 
The focus of our industrial technique has been much too narrow, 
because factors that are vital to success have been excluded. 
Something must be done, and done promptly, if our present social 
and economic structure is to survive; and in my judgment this 
work must be done by businessmen. But it is encouraging to 
note that they need not start on this adventure empty-handed. 
We know, for example, that these large-scale enterprises, which 
are best described as " societies with an economic aim," are bal- 
anced structures, like all other creations in our world, and that 
their equilibrium has been disturbed because we have focused too 
much attention on the economic aim and too little on the society. 
The life of the society and the success of the business (its economic 
aim) must stand or fall together, for it is obvious that if the 
business does not pay the society will disintegrate, and if the life 
of the society is not vigorous "the cooperative effort" on which 
business success depends cannot be obtained. It is by over- 
emphasis on the economic aim and inattention to the social struc- 
ture and the social aims of the group that our present condition 
of disequilibrium has been produced. 

In case any skeptic should be disposed to question whether an 
industrial enterprise such as we have indicated is in fact "a society," 
he has only to come down out of his world of abstractions and look 
at facts. The work of these enterprises is done by men and women 
who spend a major fraction of their lives in personal contacts 
that are as close as those of most family units. Unless it be assumed 
that these men and women cease to be human beings during their 
working hours, fairly intimate social relations must result from 
these daily contacts. Of course, we shall have to admit that 
during the period of rapid development of modern large-scale 
industry the technicians have all too often treated men and women 
as if they were pieces of machinery or pieces of furniture. But 
that does not make them so, and no one who will take the trouble 
to study in detail "the social structure" of any particular business 
unit can doubt that he is observing the life of a social organism. 


So far we are walking on firm ground — the ground of observed 
fact — but we cannot proceed much farther without more study. 
The change of scale to which we have referred has made most of our 
sociological theory inapplicable and, in fact, useless. The major 
problem that confronts the businessman today is the gathering of 
the facts about the human relations in modern industry that are 
needed to form the basis of a new social theory which will take 
form in new social inventions. This is an immense task, but 
here again he does not start empty-handed. Scientists have been 
at work for generations developing methods of research which, 
with slight modifications, can be used in the study of these prob- 
lems. Some studies have already been made, and there is a 
small but inspiring literature on this subject to which the reader 
is referred. What the high executive needs in order to deal with 
the social problems is, first, recognition that the problems 
exist and that it is his business to solve them, and, second, 
the sort of expert advice based on careful observation which will 
enable him to settle his social problems without resort to abstrac- 
tions. In many other departments of his business he does this 
now. The chemical composition of steel, for example, is an 
abstraction to the administrator; in fact, a formula. But if 
he wants to buy some steel ingots, he does not have to deal with 
abstractions. He can call in his expert who can, if he chooses, 
look into the very heart of an ingot and tell him what he sees 

In the same way, industrial relations departments and person- 
nel departments can be so organized that they bring the high 
executive into as close relation with the men and women who 
work for and with him as was the owner-manager fifty years ago. 
Many firms have personnel departments, or industrial relations 
departments, and some have both. But it is rare that these 
departments are taken seriously enough by the higher officers of 
the company, and therefore they are rarely staffed with ade- 
quately trained men. What is even rarer is a personnel depart- 
ment with an adequate supply of observed facts regarding the 
social problems within the firm, on which to base the sort of 
advice demanded by a high executive who is seeking for light. 

The fact is that we need a great amount of patient and thorough 
social research in the interior of our large firms. A beginning has 
been made but the search still has far to go. 


This book provides some vivid examples of the sort of prob- 
lems that need study, and to me the most interesting thing about 
the book is that, after months of careful and expert investigation, 
Dr. Pigors and his collaborators have arrived only at the threshold 
of the problem. Each question raised by the cases in this book is 
only the point of beginning for a new inquiry. The work which 
the authors have done, and which this book contains, is work for 
which few men are qualified, and it is hoped and expected that 
they will go on. It is also devoutly to be hoped that many others 
will follow their example. 

Philip Cabot. 

Professor of Business Administration 
Harvard University, 

Soldiers Field, Boston, Massachusetts, 
December, ig38. 



Foreword by Philip Cabot v 

List of Charts xix 

List of Tables xxiii 

Introduction i 


Selection of Workers 17 

A. Hiring 
General Statement of Practice at the New Process Rubber Com- 
pany, Inc 17 

Case 1. Sample Letters from Applicants for Employment ... 23 

(These letters must be evaluated and answered by the employment 

Case 2. Julia Stanizzi 27 

(An employee brought pressure to bear on her foreman, who disregarded 
modern employment procedure and attempted to supersede the employ- 
ment manager.) 

Case 3. James J. Robinson 31 

(Different forms of "political" influence were used to persuade the 
employment manager to hire this man.) 

Case 4. George McCue 33 

(An illustration of direct political pressure.) 

Case 5. Case of Attendants 37 

(A supervisor exerted pressure to hire an increasing number of college 
men on factory jobs.) 

Case 6. Afternoon Shift Versus New Equipment 41 

(A supervisor urged the advisability of an afternoon shift, which would 
have meant hiring women, mostly married.) 

Case 7. Andrew Beauchamp 45 

(An old employee of the company urged the employment manager to hire 
his son in preference to others who were better qualified.) 

B. Rehiring 
General Statement of Practice at the New Process Rubber 

Company, Inc 49 




Case 8. Giuseppe Di Giacomandrea 51 

(A social agency urged the employment manager to rehire a person on 
relief. Difficulties with a union representative ensue.) 

Case 9. The Beecher Case 55 

(Pressure was brought to bear by the union to rehire one of its members.) 


Transfers 57 

Statement of Practice at the New Process Rubber Company, 

Inc 57 

Case 10. The Case of Viola Burns 61 

(A transfer of promotion.) 

Case n. The Case of David Walsh, Jr 65 

(A transfer of demotion.) 

Case 12. The Thompson Case 69 

(A remedial transfer that was initiated by the departmental supervisor. 
The departmental difficulties were of a more basic nature than the 
obvious personal maladjustment of the employee, and his transfer failed 
to solve the problem.) 

Case 13. George Henderson 73 

(A remedial transfer that was initiated by the employment manager. 
The transfer was successful but raised a production difficulty.) 

Case 14. Stitching Department Transfers: An Experiment in 

Employment Stabilization 77 

(Production transfers that illustrate the many problems raised by the 
New Process Rubber Company's experiment in employment stabiliza- 

Case 15. The Rinehard-Coughlin Case 89 

(Transfers into a department following an increase of departmental 
activity. Transfers in.) 

Case 16. The Kelly-Flanagan Case 93 

(Production transfers following a decrease of departmental activity. 
Transfers out.) 

Employee Rating and Layoff Procedure 99 

Case 17. Tentative Procedure of Employee Evaluation at the 
New Process Rubber Company, Inc 99 

Case 18. The Case of Service Shoe Elaine 109 

(Difficulty of safeguarding the employment of a specially qualified 

Case 19. The Baxter Case 113 

(Mr. Baxter's layoff brought to light a curious social complication. 
Baxter's foreman was his tenant.) 



Case 20. The Case of Pierre Renault 117 

(Mr. Renault was laid off. He was given a hearing before the supervisor 
of industrial relations. Statements made at the hearing hinted at social 
complications. The foreman reconsidered the case and decided to give 
Renault a second chance.) 


Discharge 121 

Case 21. Changing Trends in Foremen's Attitude toward Dis- 
charge at the New Process Rubber Company, Inc., and at the 
National Manufacturing Company, Inc., Plant No. 10 ... 121 

Case 22. Alfredo Bonaccio 125 

(Illustration of a supervisor's reluctance to discharge an employee even 
"for cause." New Process Rubber Company, Inc.) 

Case 23. The Kuczinsky Case 129 

(Case of a nonunion employee who had been discharged for fighting and 
who petitioned for reinstatement.) 


Employee Training 133 

Case 24. Statement of Practice at the New Process Rubber 
Company, Inc 133 

A. Training New Workers. 

1. The Apprentice System 133 

2. The Vestibule School 134 

3. Teaching on the job by staff members 136 

B. Training Potential Supervisors 138 

C. Foremen Training. 

1. General Inspirational Courses 146 

2. Lecture Courses on Specific Subjects 146 

3. Development of Mixed Discussion Groups 148 


Length oe Service 151 

General Statement of Practice 151 

Case 25. Method of Computing Length of Service of Factory 
Employees at the New Process Rubber Company, Inc. ... 153 

Case 26. Marie Kusacz 157 

(Relation between sickness absence and length of service. Other 

Wage Administration 163 

Case 27. Wage Rates of Electricians in the Maintenance De- 
partment of the National Manufacturing Company, Inc. . . 163 

Case 28. Salary Allowance during Absence 171 

(Policy at the New Process Rubber Company, Inc.) 



Case 29. The Wilson Case 183 

(Employees' demand for a wage increase covered dissatisfaction with 
alleged unfairness in rating.) 

Case 30. The Group-Leader Plan 187 

(Description of a change in the method of payment and consequent 
changes in organization.) 

Wage Attachments and Loans to Employees 191 

Case 31. Wage Attachments at the National Manufacturing 
Company, Inc 191 

Case 32. Loans to Employees at the New Process Rubber 
Company, Inc 195 

Hidden Pensions 205 

Case 33. The Six Little Jackmen 205 

(Conflict between unemployment insurance and informal company 
policy of taking care of superannuated employees.) 


Industrial Safety 211 

Case 34. The Positive Safety Guard 211 

(Socially conditioned attitudes on the part of 1 
the installation of a foolproof safety device.) 

(Socially conditioned attitudes on the part of union labor interfered with 

de ' 

Working Conditions 221 

Case 35. The Fan Case 221 

(Tension between workers and supervisors brought to a head by the 
inadequate interrelation of departments.) 


Suggestions from Employees 227 

Case 36. The Suggestion Plan at the National Manufacturing 
Company, Inc 227 

Vacations 235 

Case 37. The Veterans' Association 235 

(Interference between social organization and company vacation policy.) 


Compensation for Accidents 237 

Case 38. Case of Anton Palacek 237 

(Company's attempt to rehabilitate an employee who had lost four 



Case 39. Case of George Monnier 241 

(Social complications in a "lame-back" case.) 

Union-management Cooperation at the National Manufac- 
turing Company, Inc 253 

Case 40. The Campaign against Waste and Defective Work- 
manship at the National Manufacturing Company 253 

(An experiment in union-management cooperation.) 

Case 41. The Stevenson Case 269 

(Union-management cooperation in bringing back work that had been 
sent outside.) 


Personality Problems 277 

Case 42. The Case of Aristide Cote 277 

(Personal preoccupations of a toolmaker at the National Manufactur- 
ing Company, Inc., Plant No. 10.) 

Case 43. The Corelli Case 285 

(Difficulties of a demoted group leader.) 

Case 44. Case of Deborah Larkin 289 

(A transferred inspector with long service insisted that she should be 
placed on the first shift.) 

Case 45. Mitchell Case 293 

(Unexplained difficulties in the engineering model shop.) 

Case 46. The Bowditch Case 299 

(Conflict between a union representative and a transferred employee.) 

Appendix A. General Description of the New Process Rub- 
ber Company, Inc 305 

Appendix B. General Description of the National Manu- 
facturing Company, Inc., Plant No. 10 316 

Index 323 


Chart Page 

I. New Process Rubber Company, Inc. Production of 
summer and winter footwear (in terms of pairs of shoes), 
1927-1929 79 

II. Labor turnover comparison between the New Process 
Rubber Company, Inc., and the boot and shoe industry 
1934-1936 85 

III. Stitching department labor trend, 1934-193 7. Em- 
ployees hired and transferred in, New Process Rubber 
Company, Inc 86 

IV. Stitching department labor trend, 1934-193 7. Em- 
ployees laid of! and transferred out, New Process Rubber 
Company, Inc 87 

V. New Process Rubber Company, Inc. Discharges: 
19 1 8-1 93 7, factory employees for all causes 121 

VI. New Process Rubber Company, Inc. Discharges: 
191 8-1937, ma <le factory employees. Reasons for dis- 
charge 122 

VII. New Process Rubber Company, Inc. Discharges: 
191 8-1 93 7, female factory employees. Reasons for 
discharge 123 

VIII. National Manufacturing Company, Inc. Discharges: 

1927-1929; 1936-1937, factory employees 124 

IX. A shoe-making unit during the vestibule school era . . 134 

X. Classification of electricians in the maintenance depart- 
ment, National Manufacturing Company, Inc 168 

XL Classification of electricians in the maintenance depart- 
ment, National Manufacturing Company, Inc., accord- 
ing to a strict interpretation of labor grade 168 

XII. Wage rates of electricians in the maintenance depart- 
ment, National Manufacturing Company, Inc 169" 

XIII. Sickness Absence Record Card. New Process Rubber 

Company, Inc 174 



Chart Page 

XIV. New Process Rubber Company, Inc., sickness absences 

for 1936, clerical payroll 182 

XV. National Manufacturing Company, Inc., wage attach- 
ments, actual and threatened; August, 1936, to July, 
1937 194 

XVI. Organization chart of the National Manufacturing 

Company, Inc., Plant No. 10. . . 254 

XVII. Local Plant's 45 charge by months, expressed in dollars 265 

XVIII. Divisional monthly averages of local plant's 45 charge 

expressed in dollars . / 265 

XIX. Local plant's 45 charge in per cent of productive labor 

cleared in cost 266 

XX. Divisional cumulative percentages of plant's 45 charge, 

in per cent of productive labor cleared in cost 266 

XXI. Organization chart, New Process Rubber Company, 

Inc 307 

XXII. Organization of the industrial relations department at 

the New Process Rubber Company, Inc 310 

XXIII. Age distribution of male and female employees of the 
New Process Rubber Company, Inc., January 1, 1937 313 

XXIV. Age distribution of male and female employees of the 
New Process Rubber Company, Inc., January 1, 1938 314 

XXV. New Process Rubber Company, Inc., marital distribu- 
tion of employees, 1927-1931; 1934-1937 314 

XXVI. New Process Rubber Company, Inc., distribution of 

employees according to length of service, 193 5-1 93 7 315 

XXVII. Residential distribution of employees of the New 

Process Rubber Company, Inc., 1933-1937 315 

XXVIII. Plant organization of the National Manufacturing Com- 
pany, Inc., Plant No. 10 317 

XXIX. Employment activity at the National Manufacturing 

Company, Inc., Plant No. 10 318 

XXX. National Manufacturing Company, Inc., Plant No. 10; 
distribution of all factory employees (male and female) 
according to differences in skill. Population data, 
June, 1937. Total number of employees, 5,123. . . . 320 


Chart Page 

XXXI. National Manufacturing Company, Inc., Plant No. 10; 
distribution of male factory employees according to 
differences in skill. Population data, June, 1937. 
Total number of employees (M), 4,038 321 

XXXII. National Manufacturing Company, Inc., Plant No. 10; 
distribution of female factory employees according to 
differences in skill. Population data, June, 1937. 
Total number of employees (F) 1,085 3 21 

XXXIII. Organization of the industrial relations department of 
the National Manufacturing Company, Inc., Plant 
No. 10 322 


Table Page 

I. New Process Rubber Company, Inc., ratio of applications 
for work and number of individuals hired, 192 7-1 931 ... 19 

II. Distribution of applicants who were given a final interview 21 

III. Effect on service record if wage earner is laid off ... . 152 

IV. 1936 clerical payroll: length of service (0-10 years). ... 177 

V. 1936 clerical payroll: days lost through sickness absences 
by departments and length of service 178 

VI. 1936 clerical payroll: hypothetical absence allowances with 
pay according to the proposed new system (0-10 years 
service) 178 

VII. 1936 clerical payroll: employees by length of service (10 

years and over) 179 

VIII. 1936 clerical payroll: days lost through sickness absences 

by departments and length of service (10 years and over) 180 

IX. 1936 clerical payroll: hypothetical days' absence allowance 
with pay according to the proposed new system (10 years 
and over) 182 

X. Monthly statement of loans to employees (as of September 
i, 1938) 203 

XI. Analysis of reasons alleged for requiring a loan (accepted 

applications only) 204 

XII. Suggestions, 1925-1935 231 

XIII. Suggestions adopted and regular awards paid 231 

XIV. Employment procedures of thirty concerns 309 



In 1933 Dr. Elton Mayo published his interesting study, "The 
Human Problems of an Industrial Civilization." 1 Since that 
time, he and his associates in the department of industrial research, 
Graduate School of Business Administration, Harvard University, 
have published various other studies calling attention to the 
importance of the social factor in industry and business. 2 All 
these publications take as a working hypothesis the proposition 
that might be summarized as follows: "A business or industrial 
firm is not only an organization for the promotion of economic 
aims but also a human organization, or society, in which the 
hopes and aspirations of individuals are trying to find expression.' ' 

The truth of this hypothesis can be demonstrated only by 
firsthand observation and, although the publications referred to 
above provide a considerable number of such observations, 
clearly, additional studies are needed before the hypothesis can 
be verified. In making the studies here reported, our objective 
was to accumulate additional material on management-worker 
relationships in large-scale enterprises. Such enterprises were 

1 The Macmillan Company, New York. 

*Cf. Philip Cabot, "The New Industrial Era," Harvard Business Review, Janu- 
ary, 1934; F. J. Roethlisberger and W. J. Dickson, "Management and the Worker. 
Technical vs. Social Organization in an Industrial Plant," Harvard University, 
Graduate School of Business Administration, Business Research Studies, 9, October, 
1934; T. N. Whitehead, "The Scientific Study of the Industrial Worker," Harvard 
Business Review, July, 1934; Philip Cabot, "Government and Business," The 
Journal of Accountancy, December, 1935; T. N. Whitehead, "Social Relationships in 
the Factory: A Study of an Industrial Group," The Human Factor, November, 1935; 
L. J. Henderson and Elton Mayo, "The Effects of Social Environment," The 
Journal of Industrial Hygiene and Toxicology, September, 1936; F. J. Roethlis- 
berger, "Understanding: A Prerequisite of Leadership," address before Professor 
Cabot's Business Executives' Group, February, 1936; F. J. Roethlisberger, "The 
Social Structure of Industry," address before Professor Cabot's Business Executives' 
Group, December, 1936; T. N. Whitehead, "Leadership in a Free Society," Harvard 
University Press, 1936; Paul Pigors, "Give Foremen a Chance," Personnel Journal, 
December, 1937; F. J. Roethlisberger, "Social Behavior in Industry," address 
before Professor Cabot's Business Executives' Group, February, 1938 (also printed 
in Harvard Business Review, July, 1938). 


selected because it is in operations on this scale that the contrast 
(and often the conflict) between the technical and social organ- 
izations in a firm are most apparent. 1 In small businesses there 
is still much opportunity for face-to-face contact, and the owner- 
manager is frequently the accepted leader, not only of the firm 
but also of the community where the business is carried on. In 
large firms, however, the gulf between management and the 
workers is inevitably so great that there is practically no oppor- 
tunity for personal contact between the higher executives and the 
men and women "at the bench." 

It should be observed at the outset that the studies here 
undertaken were of a wholly different character from the "busi- 
ness cases" that are in common use. Such cases are merely 
records of observed facts that the student can obtain from the 
business executive. But our problem was different. We were 
searching for facts and social relationships that had not been 
observed, or even formulated, so that no one could answer the 
questions that we did not know how to ask. Under these circum- 
stances, it was obviously difficult to find firms where the higher 
executives were so intelligent and so sympathetic with our objec- 
tive as to make possible the type of research on which we were 
engaged. We had no difficulty, of course, in obtaining formal 
introductions to company officials and, through them, to all the 
members of the technical organization down to the work level. 
The officials were always willing to show us through the plant 
and explain to us the technical organization and the plant layout. 
But this was not enough. In addition to the information that 
we could obtain in this way, we needed to establish relations 
with the workers themselves, and we also needed to know how the 
organization that we had been looking at worked in actual prac- 
tice. The guide- visitor relationship gave us a picture of things 
as they were supposed to be but not necessarily as they were. 
Our guide could rarely do more than give us what amounted to a 
blueprint description of the plant and its organization and a 
formal statement of the policies regarding labor relations as under- 
stood by management. But these last, also, were rather the 
formal plans for action than deductions from actual experience 
showing what in fact went on. Often the description of intricate 

1 See F. J. Roethlisberger, "The Social Structure of Industry," p. 12, for a more 
detailed description of this point. 


systems of job classification, employee evaluation, or employee 
training proved to be little more than a statement of what the 
company would like to put into practice rather than descriptions 
of the actual everyday life of the workers in the plant. 

We were often asked for our impressions, and our hosts were 
always willing to answer questions, but, unless these questions 
were limited to technical and economic problems, the talk tended 
to drift off into vague generalities. Everything went smoothly 
as long as we followed "the beaten paths" of established tech- 
niques, but as soon as we strayed from these paths and showed 
curiosity about detailed human relations, we found we were 
asking questions that could not be answered. After some experi- 
ences of this kind, it became obvious to us that arm's-length 
contacts of this sort would not answer, because more intimate 
relations to the worker than were possible for a mere visitor must 
be established. 

Two things were desirable for, if not essential to, the establish- 
ment of such a relationship: first, the observer needed sufficient 
freedom of movement to enable him to get a picture of the oper- 
ation of the plant as a whole; and, second, he should be in a posi- 
tion to establish personal contacts at the work level. To gain the 
first objective it was necessary to be on friendly terms with one 
or more of the high executives of the firm. The reason for this is 
obvious, for if the president of the company, or the works man- 
ager, was sympathetic it was quite easy to secure the cooperation 
of all subordinate officials. Once top management had given the 
observer "the freedom of the plant," so to speak, it was possible 
to attain our second objective and to begin to establish close 
personal relationships with foremen and workers. In the two 
firms where the studies here reported were made, these objectives 
were gradually attained. 

The casual reader might suppose that firms where this could 
be accomplished are as common as blueberries in August. But 
they are not. In fact, these two firms are probably quite excep- 
tional, and we are keenly appreciative of the opportunities they 
offered us. 

In the National Manufacturing Company it seemed wisest 
to use the office of the industrial relations manager as our center 
of operations, because our previous visits had shown that this 
official acted as a coordinator of management practices and, in 


one way or another, succeeded in relating himself to every level 
of supervision, to every branch of the organization, and, directly 
or indirectly, to nearly every worker in the plant. He also repre- 
sented management in its dealings with the labor union and had 
almost daily contact with union officials. 

The focus of our research was management-worker relation- 
ships, not as they were assumed to be in the technical organiza- 
tion, but as they were in actual fact. In other words, our interest 
was not so much in what management expected the technical 
organization to accomplish, or in the theoretical procedures by 
which the industrial relations manager hoped to achieve certain 
ends, but in observing the day-to-day relationships of manage- 
ment and workers in operation and the way in which problems 
were dealt with as they arose. 

The observer stayed in the plant for a week or 10 days at a 
time, fitting himself into the organization in such a way that he 
could participate in routine activities and follow the course of 
problems through the plant. By assisting the industrial relations 
manager in some of his work, the observer was able to establish 
pleasant relations with other members of the organization. 

At the New Process Rubber Company we followed practically 
the same course, although the office of the employment manager 
was used as a center. Here, too, it was found possible to carry 
on our investigation without interrupting the work of the employ- 
ment manager or adding to his burdens. In both companies, we 
were treated with the utmost courtesy. 

Our observations were carried on over a period of about two 
years, during which the observer spent most of his time in these 
two firms, and the information obtained seems to verify the 
hypothesis stated above, namely, that there were two organiza- 
tions — the technical and the social — whose points of view were 
often in sharp contrast, or even in conflict. By the technical 
organization, individual workers were envisaged as impersonal 
units to which abstractions like " budgets," "cost curves," 
" production schedules," "standard time operations," "base 
rates," and "man-hours" were properly applied. Our personal 
contact with the workers, however, soon showed that these 
abstractions were very remote from their everyday experience 
and, as a result, the employees not only failed to understand them 
but frequently resented them as a form of legerdemain with 


which management sought to obscure essentially simple relation- 
ships. To the worker, the plant is not only the place in which he 
earns his living but also the place where he spends an important 
part of his life. Consequently, to him the most vital problem is 
the development of a pleasant working relationship with other 
employees, with foremen, and with such staff officers as come into 
daily contact with him. In these relationships, sentiments, codes 
of conduct, and socially determined attitudes play an essential 

The cases presented here give abundant evidence that the 
behavior of the worker is essentially nonlogical, and that it is 
not affected so much by the logic of operating systems as by 
feelings and social codes. For example, the meaning of such 
concepts as "fair," " discrimination/' " similar work," " versa- 
tility," "normal output," "quality of work," "conduct," "cooper- 
ation," "skill," "reasonable," "monotonous," etc., is for the 
worker emotionally conditioned and not subject to objective 
verification. These sentiments and social codes complicate the 
management-worker relationships and often make them very 
different in fact from their appearance on a logical and technically 
correct organization chart. Our observations showed the exist- 
ence of frequent conflicts between the logic of efficiency and the 
sentiments of the workers. In developing policies and systems 
for the guidance and control of labor relations, it appeared to us 
that management was too ready to assume that workers were 
primarily governed by logic and economic self-interest. It also 
seemed that statements of policy coming from executive officials 
tended to overstress the administrative and technical aspects of a 
decision and to overlook its social implications, i.e., its real mean- 
ing to the worker. As a result, not only the workers but also the 
foremen often failed to understand what management was trying 
to accomplish. Later, when the sentiments, emotions, and anxie- 
ties of the workers had been aroused and had produced conse- 
quences that threatened to defeat the objective at which the 
management aimed, the foremen, who were in direct contact with 
the workers, were confused and did not know which way to turn. 

As an illustration of this kind of conflict, the reader is referred 
to the New Process Rubber Company's experiment with employ- 
ment stabilization. In this case, management desired to reduce 
a high labor turnover and give the workers more continuous 


employment, and, clearly, the logical way to do this was to train 
workers to be more versatile and then transfer them from one 
job, or department, to another. Management made the logical 
assumption that employees would gladly cooperate in this plan, 
but experience showed this assumption to be unfounded. A trial 
of the plan showed that skilled stitchers valued the prestige of 
their jobs more than job security and vigorously resisted retraining. 
Their attitude was well expressed by an operator who said: "I'm 
a stitcher and I'm going to stay a stitcher, even if I get laid off." 1 

At the National Manufacturing Company, also, there was 
much evidence of the conflict between the logic of efficiency and 
the nonlogic of socially conditioned attitudes and sentiments. 
For example, employees in the punch-press department were 
constantly exposed to a serious accident hazard that might involve 
the loss of several fingers or an entire hand. There were frequent 
casualties that not only entailed personal mutilation but upset 
the morale of the whole department. In its efforts to find a remedy 
for this serious condition, management quite naturally assumed 
that the employees would welcome the installation of any device 
that would once and for all eliminate this particular hazard. 
But the device, when found, required the employee to strap him- 
self into a harness, which was attached to the machine, and this 
so outraged the sentiments of the workers that their union repre- 
sentative stated that no worker could be expected to submit to 
"the intolerable condition of being chained to his job," and insisted 
that the device be removed. 2 This is a striking example of the 
conflict of logic with sentiment. 

Examples such as these indicate that management cannot act 
intelligently unless it has an intimate understanding of the feelings 
and sentiments that control the attitudes and behavior of indi- 
vidual workers. Management has been extremely successful in 
developing a formal line of communication that facilitates the 
transmission of orders and technical information from the top to 
the bottom, but it now appears that this line of communication 
should be a " two-way street." There is great need for the devel- 
opment of new techniques that will promote mutual understand- 
ing and provide top management with pertinent social information 
coming up from the work level. It would seem that unless informa- 

1 Case 14, Stitching Department Transfers: An Experiment in Employment 
Stabilization, pp. 77~88. 

2 See Case 34, The Positive Safety Guard, pp. 211-219. 


tion moves freely in both directions the success of the enterprise 
may be seriously jeopardized. 

Another observation regarding large-scale management is its 
tendency to oversimplify problems connected with human rela- 
tions. When personnel difficulties arise, management wants to 
be presented with a neatly formulated problem that it can solve 
promptly in logical terms and to which it can apply an immediate 
remedy. No desire could be more natural or more impossible to 
satisfy. In real life, social problems do not exist in neatly pack- 
aged form. It is impossible to separate a social situation from 
the surrounding circumstances, or environment, in which it is 
embedded. Instead of a simple issue that could be formulated, 
we almost invariably found ourselves confronted with a tangle 
of problems, so that our first task was to sort out the component 
elements in order to formulate an issue on which to begin our 
inquiry. In many cases, the obvious "sore spot/' or complaint, 
was not the real heart of the problem at all but a peripheral, or 
relatively secondary, problem. Also we found that each situa- 
tion contained so many interdependent variables that it was 
rarely possible to foresee the ultimate effect of any particular 
decision or action. The following description of the efforts of the 
New Process Rubber Company to train foremen will serve to 
illustrate this point and also to show that the problems of human 
relations that confront modern large-scale management are not 
confined to the bench level. 

The upper stratification of the management organization of 
this firm consisted of various department heads who had been 
given a high degree of administrative authority within their own 
departments. This arrangement, however, tended to produce 
departmental isolation and conflicting practices with regard to 
employment; an obvious weakness that had to be remedied, 
because it was necessary for the plant to have fairly uniform 
employment practices. The method used to solve this problem 
was to make general rules and regulations governing employment 
in all departments and to establish an employment department 
to coordinate employment practices. In time this coordination 
was successfully achieved, but in the process a new difficulty 
arose. The foremen soon came to look upon these general rules 
and regulations as relieving them of responsibility in regard to 
employment. They subordinated themselves to what they took 


to be established employment routines and tended to shift to 
the employment manager responsibility for all disagreeable 
decisions regarding labor relations. Management was thus faced 
with the new problem of how to prevent this shifting of responsi- 
bility from the shoulders on which it belonged. The method 
adopted was to formulate company policies, which were designed 
to focus the foremen's attention on ends rather than means, so 
that within the broad framework of company policy he must 
solve his own problems. But in the minds of the foremen this 
merely led to a confusion between rules and policies and made 
some foremen even more dependent on the employment manager 
than before. Many foremen continued to accept statements 
issued by management as " rules." To them, policies were only 
rules so vaguely stated as to lead to conflicting interpretations, 
and, in order to keep out of trouble, they continued to shift 
responsibility for employment decisions to the employment 

Here was a new difficulty, and to overcome it management 
decided to try to develop a better understanding of company 
policies. The method chosen was through foremen's discussion 
groups. Under intelligent leadership, foremen soon began to 
understand what a policy was and how it originated. But com- 
plications again appeared. In discussing company policies the 
foremen made many critical suggestions and urged that they 
should be given an opportunity to participate in formulating 
policies. If this were permitted it meant, of course, that the 
level of decision would be lowered and that there would be greater 
diffusion of responsibility. This was not the result that manage- 
ment had wished to attain, and the soundness of it was doubtful. 
We see in this chain of events that foremen had certainly regained 
their independence, but they asserted it with regard to plant 
rather than departmental problems. In employment matters, 
especially when the case was disagreeable, they continued to shift 
responsibility to the employment manager. 1 

Our experience suggests that the chief difficulty in dealing 
with personnel problems on a logical or " scientific" basis is that 
this method assumes the possibility of stabilizing the other vari- 
ables while one variable is being observed. But in dealing with 
human beings this is usually impossible. Our studies showed that 

1 See Section IV, Discharge, Case 22, Alfredo Bonaccio, pp. 125-127. 


each separate problem was inextricably bound up with other 
problems and could not be isolated. Before the industrial rela- 
tions manager or the employment manager was able to formulate — 
much less to solve — one problem, another stuck up its head. 
This hydra-headed aspect of social problems was very discon- 
certing, for the more energetically we attacked one problem the 
more problems we managed to raise. In working toward employ- 
ment stabilization, for instance, such issues as proper classifica- 
tion of jobs, employment evaluation, wage rates, pay guarantees, 
and training problems all proved to be variables pertinent to the 
question in hand and difficult to stabilize. At certain stages, 
indeed, the original problem seemed to sink into the background, 
and our attention was focused on what had previously appeared 
to be a minor issue. 

The foregoing illustrations strongly suggest that management 
needs to develop new techniques for understanding the structure 
of the " society" with which it has to deal and for understanding 
the individuals composing that " society," in order to promote the 
degree of human collaboration essential to economic success. 
The systems and routines now in operation take their shape from 
the technical aspects of industrial operation, and even personnel 
managers whose function it is to facilitate cooperative effort and 
promote mutual understanding find it difficult to free themselves 
from the logic of efficiency. 

Also our studies in these two firms, and the "cases" that em- 
body them, indicate that the social and human problems of modern 
large-scale industry are not confined to the work level. They 
seem to permeate the organization from top to bottom. A brief 
description of the present technical organization in these firms, 
showing the development of the staff organization and the rela- 
tion between the line and the staff, brings this out quite clearly. 

In both firms, administrative authority was built up as a 
hierarchy of positions with definite allocation of departmental 
responsibilities to each department head, the entire system forming 
a pyramid that finally concentrated in a single or corporate indi- 
vidual all power to initiate or prohibit action. Thus the president, 
or the board, delegated authority to subordinate officials, such 
as works managers, division superintendents, general foremen, and 
foremen, to direct action in their respective fields. This method 
of control represents what is commonly known as a "line organiza- 


tion," which in these firms was in charge of all so-called productive 
labor, i.e., workers who manufactured the products for which the 
plants were built. This line organization was designed for the 
purpose of technical and economic control. New techniques were 
constantly being developed. Rapid progress had been made in 
perfecting technical skills, and this type of organization was 
admirably adapted to such a purpose and also to the control of 

But, as the companies grew in size and complexity, a line 
organization alone tended to become inefficient. There was lack 
of coordination between different departments, and major execu- 
tives, as well as department heads, were unable to obtain the 
information on which the formulation of general business policies 
and their sound administration depended. Furthermore, top 
management found it practically impossible to keep in touch with 
conditions at the work level, a situation that promoted conflict 
instead of cooperation between management and the workers. To 
meet these difficulties, a combination of staff and line was devised. 1 

Under this system, staff experts had no administrative author- 
ity over productive labor, or over any member of the line organiza- 
tion. They were specialists whose duty it was to act in an advisory 
capacity to company executives and other members of the line 
organization. The industrial relations manager, the employment 
manager, the development and safety engineers, experts in time 
and motion studies, and other staff officials had no authority to 
give orders outside their own staff departments. Strictly speak- 
ing, for example, the employment manager had no power to give 
orders or to direct action in any department of the plant outside 
his own, because this would inevitably lead to a division, and 
possible conflict, of authority. Orders concerning the number and 
quality of employees in any department had to be given by some 
member of the line organization, because otherwise the foreman 
could always blame his production or labor troubles on the inade- 
quate number or poor quality of workmen furnished him by the 
employment manager (a staff officer). To avoid such confusion, 
each line foreman was to be held strictly responsible for the 
administration of his own department, or section. Subject to 
the approval of his immediate superior, he was charged with the 

1 See Case 40, The Campaign to Eliminate Waste and Defective Workmanship, 
pp. 253-268, as an illustration of conditions that led to the introduction of staff 
specialists at the National Manufacturing Company, Inc. 


duty of deciding how many workers he needed and whether or 
not a candidate for employment was acceptable. The whole 
duty of the employment manager and members of his staff was to 
control the mechanism for handling applications for employment 
and to endeavor to satisfy the needs of each line foreman. If he 
thought he saw anything going wrong, he was expected to bring 
it to the attention of the line foreman who had the power to cor- 
rect it. This principle applied to all other staff officers. 

But this coordinate adviser-advisee relationship between staff 
and line officers was in fact subject to almost daily modification. 
The forces producing this result were partly inherent in the social 
characteristics of the individuals and were partly due to the com- 
plex nature of modern management problems. 

In his dealings with line foremen, the staff official relied not 
only on his superior knowledge as a specialist but also on the 
informal, and almost subconscious, differences in social status 
associated with staff and line positions. We know from experience 
that staff officials are regarded as socially superior to line officials 
on a corresponding level of the management organization. All 
staff positions are rated as " white-collar jobs," while the minor 
line foremen continue to be associated with the shop. In spite of 
the fact that at the New Process Rubber Company most of the 
foremen (62 per cent) were college men, there remained this subtle 
distinction that stamped a position in the "main office " as supe- 
rior to a position "in the shop." This distinction gave the employ- 
ment manager and members of his staff a certain implicit supe- 
riority in his dealing with line foremen, an advantage that 
naturally was magnified in his relation with foremen who had no 
college training. At the National Manufacturing Company, 
where a majority of the foremen, including general foremen, had 
come up from the ranks, this subtle difference in social status was 
even more pronounced. 

Another factor tending to produce social differentiation was 
that staff officers were more independent in their work. Their 
research activities could not be carried on at a specific time and 
place, and the consequent freedom from routine gave them greater 
prestige. In helping to work out new policies, staff men not 
only had greater scope for their imaginations but easier access to 
the high executives. The line foremen, on the other hand, were 
practically confined to factory departments and were limited by 


production demands and budgetary controls. The work rou- 
tines of all foremen tended to follow similar patterns, while staff 
work varied greatly, even in the same company. An energetic 
and capable staff man could create for himself an almost unique 

Staff men also had greater educational advantages, because 
management urged them to attend conferences that dealt with 
their own specialties and in other ways provided contacts with 
staff members of other firms. In both plants included in this 
study, funds were available to finance such educational activities. 
The line foremen, on the other hand, had less opportunity to 
broaden their outlook. Although the companies did provide 
foremen's training and discussion groups, they were in practice 
limited to relatively narrow plant problems, and these courses 
were usually organized and directed by staff men. 1 

The preceding illustrations indicate how subtly social forces 
tend to differentiate otherwise coordinate staff and line positions, 
and it became apparent to us during the course of our study that 
the increased prestige of staff positions might become either an 
asset or a liability to the firm. The social prestige attaching to 
staff positions compensated the men for their lack of administra- 
tive power in their dealings with line supervisors. This was a 
distinct asset. In his contact with foremen, a tactful staff official 
could count on this superior social status to facilitate his work and 
strengthen his position. But from another point of view this 
ascendancy might easily become a liability. There was always 
the danger that, instead of selling his services on a coordinated 
adviser-advisee basis, the staff man would dominate a weak line 
foreman, who then became dependent and in effect surrendered a 
large part of his authority, thus breaking down the distinction 
between line and staff. 

This tendency of staff men to dominate the line supervisors 
was augmented by the foremen's desire to escape what might be 
called "the foreman's dilemma." This dilemma arose from the 
inherent conflict between the short-run point of view of immediate 
cost (which properly controls a line organization engaged in pro- 
duction) and the long-run point of view of staff departments, 
especially those of employment and industrial relations who are 
directly charged with the social and human problems of business. 
1 See Section V, Employee Training, Case 24, Foreman Training, pp. 146-150. 


This conflict was, in a sense, inherent in this form of organization 
and placed the foreman in an equivocal position that was a con- 
stant threat to his prestige. 

The following situation gives a typical illustration of the 
ambiguous position in which a foreman was often placed : 

A punch press operator, working on a piece-rate basis, found 
that his machine needed to be repaired. The defect was not 
serious, but instead of being able to run off a large number of 
pieces without interruptions, he found that periodically the die 
had to be readjusted in order to turn out perfect work. This 
cut down his earnings, and he complained to the line man who, 
in turn, notified the foreman. 

It so happened in that particular week that the foreman's 
machine maintenance account was " running into the red." For 
this reason he felt unable to make immediate repairs, and without 
further explanations he merely instructed the worker to be more 
careful. By exercising greater care, the worker could, in fact, 
make the old machine do, but only with a decrease of production. 
Instead of making 125 per cent of standard time, he only made 
100 per cent. This was perfectly satisfactory to the foreman, 
whose duty it was to keep the machines 100 per cent efficient. 
But it was not satisfactory to the worker who was accustomed to 
earn 125 per cent. 

At first the worker was a little more careful; then he tried to 
make up his lost production, which resulted in his turning out 
an excessive amount of scrap. This was an added cost that 
increased the foreman's defective-material account, and he relieved 
his annoyance by " bawling out" the worker. Several days later 
he fired him. The aggrieved worker brought his case to the indus- 
trial relations department. The supervisor of industrial relations 
investigated the case and found work for the man in another 
department. Then, budget or no budget, he advised the foreman 
to make such adjustments as to prevent this type of difficulty. 

In this way the foreman was subjected to two lines of control 
that were difficult to harmonize and resulted in an apparent divi- 
sion of authority. On one hand, the foreman's efficiency was 
constantly checked in terms of line authority and budget control. 
On the other hand, management, interested in promoting satis- 
factory labor relations through such staff activities as industrial 
relations, employment management, and safety engineering, tested 


the foreman's quality as a leader of men. Cost control was a 
daily routine, and, therefore, the foreman stressed this short- 
run and technical side of his work. Furthermore, experience 
showed that management itself, in its selection and training of 
foremen, was apt to be guided almost exclusively by technical 
considerations. When the foreman did look upon his depart- 
mental activities from the long-run point of view of industrial 
relations, he instantly came up against the limits of his weekly 
budget and production demands. As a result, foremen tended 
to evade human problems and to adopt all sorts of subterfuges in 
order to disclaim responsibility. When social problems were 
brought to their attention, they asserted that either the budget 
or some company policy had prevented them from taking action, 
or else they declined to interfere with what they denned as 
" personal" problems. 1 There were other means of dodging 
responsibility for satisfactory labor relations. Either the foreman 
" stalled" along, hoping that "things would straighten themselves 
out"; or else he took the stand that it was up to the industrial 
relations department to take care of all labor problems. As a 
result, there was a marked tendency for the industrial relations 
department to become a clearing house for labor relations problems. 
The supervisor of industrial relations, as well as the employment 
manager, and the safety engineer, instead of acting in a purely 
advisory capacity, indirectly exercised more and more adminis- 
trative control. This tended to blur their natural function. 
Instead of furnishing information and aiding in the coordination 
and interpretation of management policy, they became more and 
more involved in the settlement of small daily grievances. 

The difficulty of obtaining complete cooperation between line 
and staff departments is an old one and has been successfully 
solved in many ways. We call attention to it here because it 
appears in a slightly new form, and, if a solution is not found, 
obstacles in the road may impede or distort the growth of person- 
nel, industrial relations, and employment departments — rela- 
tively new staff departments — on the successful development of 

1 See Case 46, The Bowditch Case, pp. 299-303, as a striking example of this atti- 
tude. Further illustrations of the foreman's reluctance to accept his responsibility 
as leader of his men may be found in the following cases: Case 22, Alfredo Bonaccio, 
pp. 125-127; Case 45, The Mitchell Case, pp. 293-297; Case 27, Wage Rates of 
Electricians in the Maintenance Department, pp. 163-169; Case 41, Stephenson Case, 
pp. 269-276; Case 12, Thomson Case, pp. 69-71; Case 15, Rinehard-Coughlin Case, 
pp. 89-91. 


which so much depends. For these are the departments that 
must invent, and develop, new social techniques on which the 
future of large-scale industry hangs. The high executives of these 
firms have no more important function than to build up these 
departments in such a way that they will promote social under- 
standing and harmonious action from top to bottom of the whole 
" society." Conflicts between these staff departments and the 
line organization can do incalculable damage. 

It is a fundamental principle of leadership that authority goes 
to him who is willing and able to accept responsibility. Foremen, 
in neglecting the human side of their job, are in grave danger of 
losing their authority as leaders and finding themselves mere cogs 
in the technical organization of industry. Indications of this 
drift are their own expressions of discouragement: " We're nothing 
any more. If we don't get licked by the representative, we get 
hauled to the office and get licked there. What's the use? We 
might just as well sit down and say, 'Sure,' to everything they 
say." And again, a We get kicked around by everybody, the 
union representatives and by management. We're nothing but 
errand boys getting information and handing in reports. We're 
the goats of every new experiment." 

The remedy lies in their own hands. They can regain their 
former status as key men among supervisors only by shouldering 
the responsibilities that are rightfully theirs. To do this, they 
must equip themselves to handle the human problems that are 
the most important part of their job. Personnel men can be of 
immense help to foremen in this. An important personnel func- 
tion is to teach the foremen how to look for " social" information 
and how to interpret such data when found. The cases in this 
book are offered as samples of this kind of material. They are 
firsthand observations of routine activity on the part of men who 
are actually engaged in industry and who are therefore in the most 
favorable position to know what is happening at the work level. 

Executives will find these cases inadequate if they look at 
them as statements of problems to which a ready solution can be 
found in terms of appropriate action. The chief use of these f 
observations is that they define the area in which further research 
is urgently needed. To administrators eager for action, one effec- 
tive course is open : the encouragement of personnel managers and 
foremen in the arduous task of self-education for social leadership. 


A. Hiring 



From 1916 to 1927, the employment office of the New Process 
Rubber Company was open every working day of the week. 
Applicants usually came to the office in the morning. On entering 
they found themselves facing a wooden barrier that reached to 
the ceiling and separated them from the office force. Communi- 
cation with clerks was held through a wicket like a small box- 
office window. While the crowd milled about in the outer room, 
junior clerks called out through the wicket whatever jobs were 
available and asked suitable candidates to come up for an appraisal 
interview. Employment procedure was extremely simple. Man- 
agement relied on the daily presence of an ample but undiffer- 
entiated labor supply from which routine requisitions were rilled. 
Hiring was largely a matter of record keeping. 

In the fall of 1927, Mr. Randall was assigned to the employ- 
ment department as interviewer. To facilitate contact with the 
applicants, he asked that the wooden partition be taken away. 
After some discussion a compromise was reached to the effect that 
the upper part of the barrier was removed while the counter 
remained. In 1928 the employment department was moved to 
another building, with Mr. Randall in charge of arranging the 
office layout. At that time, he succeeded in doing away with all 
barriers and providing ample seating facilities in the center of the 
employment office. Interviewers were given desk space at one 
side of the room while the employment manager and other super- 
visors in the industrial relations department worked in glass- 
partitioned offices at two other sides. Some supervisors viewed 
these arrangements with alarm: " Why, if these people are allowed 
in here, they'll swarm all over the place. Everything will be in a 



mess. They'll be like a flock of sheep." None of these fears 
were realized. 

The employment office was opened to applicants for two hours 
each morning, and every effort was made to discourage repeated 
applications. After he had been registered, the applicant was 
told that he would be notified if and when a suitable opening 
occurred. Meanwhile, he could use his time to greater advantage 
by looking for other openings. Applicants were interviewed in the 
order of their arrival. 

The interview was made as simple and natural as circumstances 
permitted. Instead of remaining at his desk, while applicants 
filed past him and rilled out printed application cards, the inter- 
viewer now made the initial contact by going to where the candi- 
date was sitting. He put the interviewee at his ease and confined 
his questions to such routine data as: name, address, age, height, 
weight, education, and industrial experience. He jotted down 
the answers on a small blank pad. This method created an 
informal atmosphere and gave the interviewer a chance to "size 
up" the applicant during their conversation. Men and women 
were seated in separate sections and were interviewed by different 

The largest group of applicants consisted of employees applying 
in person. This group was subdivided into former employees and 
new applicants. The latter were more numerous. 

Another source of labor supply was the group of relatives and 
friends of present employees. At one time, extensive use was 
made of the so-called introduction-card system. When an 
employee learned of an opening in his department, he might speak 
to the foreman and recommend a friend. The foreman, then, 
would write out an introduction card to the employment manager 
with the following specifications: "I recommend that we hire 
N. N. preferably in department x ." The applicant 

would present this card to the employment manager and usually 
would be hired, since it was the custom to "honor such introduc- 
tion cards." The reasons for this preference were as follows: 
management believed that a worker who was recommended by a 
present employee would be more reliable than a complete stranger. 
Being already acquainted, workers in any department would also 
form a more homogeneous group. It was expected, furthermore, 
that a man who had recommended his friend would take sufficient 



interest in him to see that he was properly trained. The new 
worker, in turn, was likely to stay on the job because of feeling 
among friends. 

This introduction-card system came to be exploited. Among 
insiders, introduction cards were the recognized method of getting 
a job. It became increasingly difficult for the employment 
manager to make proper selections. After 1929 this practice was 
greatly modified. 1 Introduction cards were given out only by 
the employment manager and merely served to facilitate contact 
between the interviewer and the applicant. For instance, when 
someone approached the employment manager in behalf of a 
friend, the employment manager would give him a card introducing 
the applicant to the interviewer and stating that the bearer 
wanted to talk about the possibility of finding a job. It was 
explicity stated that the card was not a pass. 

Table I 

New Process Rubber Company, Ratio of Applications for Work 

and Number op Individuals Hired, 1927-193 i 

Source of supply 






Number of male applicants 



i5,9 6 9 

2 1 , 940 

10, 240 

Number of female applicants 


Total number of applicants 



























Total number of applicants hired 

Direct application (new employees) 

Direct application (former employees) . . . 
Introduction cards 

Public employment bureaus 



The employment manager had recourse to public employment 
bureaus only when the application file failed to provide suitable 
candidates. This happened sometimes in connection with special 
jobs that required technical school or apprenticeship training 
(clerks, mechanics, etc.). 

In like manner, advertising was regarded as a last resort, when 
there was a severe labor shortage or when special skills were in 
demand. In the experience of the employment manager, adver- 
tisements usually brought quantity rather than quality. 

1 See Table I, page 19. 


Other applications for work came through the mails. These 
were almost exclusively from applicants for office or technical 
positions and made up 2 to 3 per cent of the total applications. 
Letters were frequently in response to meetings between the 
employment manager and superintendents of local high and 
trade schools. 

Every year the employment department of the New Process 
Rubber Company handled thousands of applications even though 
there were only relatively few vacancies. Table I shows that 
before the depression of 1929 about 25 per cent of all applicants 
were hired. During the depression this ratio dropped to 5 to 10 
per cent. 

In the experience of the employment manager, the following 
uniformities appeared year after year in the qualifications of 
applicants for work: 

1 . There were first the obviously unfit, who merely merited courteous 
treatment but were not seriously considered for employment. In this 
class were grouped applicants who appeared in an intoxicated condition 
or were dirty and unkempt or physically unfit. 

2. The second group were doubtful cases. These were applicants 
who showed no obvious external signs for rejection, but a few minutes 
of conversation sufficed to convince the interviewer that he was dealing 
with people who were not qualified for employment. In some cases 
such an applicant was unable to speak the English language or showed 
an utter lack of comprehension of industrial requirements. This group 
also was eliminated. 

3. The third group comprised desirable applicants who were given a 
more thorough interview. In the course of conversation, the inter- 
viewer classified the members of this group in one of four possible 
categories. The applicant was rated either as "O.K.i," which meant 
that he was considered desirable; "O.K. 2," which signified that the 
applicant was acceptable; "O.K. 3," which classified him as "just 
passable"; or "O.K.4," which told the initiated that the applicant need 
not be given further consideration. The notation "O.K." was used 
merely to avoid hurting the feelings of the rejected candidate, in case 
he should observe what the interviewer was jotting down, and did not 
mean that he was given unwarranted encouragement. Instead, he 
was told that there was no immediate opening for employment and 
that he should not neglect any other opportunity to secure work. 

Accurate statistics were not available, but in the opinion of 
the employment manager as well as the interviewers, the follow- 
ing table gives a fair picture : 


Table II 
Distribution of Applicants Who Were Given a Final Interview 

Per Cent 

O.K.i 1 

O.K.2 15-20 

O.K.3 60-65 

O.K.4 14-24 

Analyzing letters of application for employment was less time 
consuming than conducting personal interviews but was less sat- 
isfactory as a basis for judgment. Each week, about 20 of these 
letters came to the employment manager's desk. In many cases 
the letters showed the writer to be so obviously unsuitable that 
only a courteous acknowledgment was required. If the letter 
made a good impression, the writer was asked for an interview. 
Case 1 gives representative samples of letters from applicants for 

The data obtained by letters and interviews were classified 
for ready reference in each interviewer's application file, from 
which all requisitions for workers were filled. The files were kept 
as simple as possible. The notes that had been made during the 
interviews were classified in two ways: if an applicant had prac- 
tical experience on a job his name was filed under his trade. Other- 
wise it was filed alphabetically. Each year a new file was made 
and the old one discarded. The interviewer relied chiefly on his 
memory and used the current file only as a guide. 

With a well-kept application file, the selection of employees 
would have been comparatively simple if it had not been that the 
employment manager was constantly being subjected to pressure. 
This came from supervisors, union representatives, employees, 
politicians, and social agencies. Each of these keenly felt the 
urgency of a particular need and therefore stressed special reasons 
for sacrificing the general employment policies "in just this one 
case." It was a delicate task for the employment manager to 
balance general policy and any particular cause without sacrificing 
one or antagonizing the advocate of the other. 

The following cases illustrate some typical employment 
problems : 

A. Hiring 

Case 1. Sample Letters from Applicants for Employment. 
These letters must be evaluated and answered by the employment 


Case 2. Julia Stanizzi. An employee brings pressure to bear 
on her foreman, who disregards modern employment procedure 
and attempts to supersede the employment manager. 

Case 3. James J. Robinson. Different forms of "political" 
influence are used to persuade the employment manager to hire 
this man. 

Case 4. George McCue. This gives an illustration of direct 
political pressure. 

Case 5. Case of Attendants. A supervisor exerts pressure to 
hire an increasing number of college men on factory jobs. 

Case 6. Afternoon Shift versus New Equipment. A supervisor 
urges the advisability of an afternoon shift, which would mean 
hiring women, mostly married. 

Case 7. Andrew Beauchamp. An old employee of the com- 
pany urges the employment manager to hire his son in preference 
to others who are more qualified. 

B. Rehiring 

Case 8. Giuseppe Di Giacomandrea. A social agency urges 
the employment manager to rehire a person on relief. Difficulties 
with a union representative ensue. 

Case 9. The Beecher Case. Pressure is brought to bear by 
the union to rehire one of its members. 

Case i. Sample Letters from Applicants for 

(These letters must be evaluated and answered by the employment manager.) 
Sample Letter A 

" Hiring & Firing Department" 
New Process Rubber Company 

Gentlemen : 

This is to ask if you have any openings in either sales or produc- 
tion for a young man who is willing to work hard, and to make his 
own way. 

This young man majored in English Literature while at Yale, 
figuring that since the rest of his life would probably be coffee, he 
might as well get the cream while the getting was good. He got 
pretty fair marks, nothing to write home about, but better than 
the average. He ran some Varsity cross-country, sang in the 
Glee Club, was an active member of the Dramatic Society, and 
contributed to the undergraduate magazines. He's a minister's 

During the eight years that have passed since his graduation 
he has worked in (i) a tannery, (2) a bank, (3) a Department 
Store, and (4) a textile mill. The depression handled him pretty 
roughly, notwithstanding this he's bobbed up serenely. In his 
spare time he's studied law, but he feels that all the work he has 
done thus far have fitted him for a business career, rather than 
the professions. 

Naturally he doesn't want to sell himself cheap. He's a better 
than average man, and he expects to get a fair rate of pay for his 
efforts, not only in money but in opportunity, working conditions, 
friendships, and unless he gets these things he will merely use you 
as a meal ticket until he gets another job. But if you have the 
job he's looking for he will give you two dollars worth of work for 
every dollar you pay him. 

How about it, Mr. Hirer & Firer? Have you got a job for this 
man at your place? If you have, won't you please write to me? 
References etc. gladly furnished on demand. Certainly Hope you 
can place this young man, because he and I generally get hungry 
at about the same time. 

Very sincerely yours, 
David Balfour 


Sample Letter B 

Mr. Gordon Randall, Employment Manager 
New Process Rubber Company 

Dear Mr. Randall: 

Can your organization offer an opportunity to a young private 
secretary of poise, experience and business judgment, and capable 
of meeting social situations of modern business with foresight and 
tact? Since my graduation from Boston University, my years of 
private secretarial experience have shown me that I have the 
ability to meet the challenge of executive responsibilities commen- 
surate with such duties. The secretarial position in which, I 
believe, I could serve at my highest efficiency is one which will 
require initiative, creative ability and social wisdom. 

I am 24 years of age, in excellent health and considered to have 
a pleasing personality. I am told that my telephone and speaking 
voice is of better than average quality. My family background 
represents the average stratum of social and financial standing, 
with an atmosphere of culture. My religious affiliation is Protes- 
tant, and I am a member of the Eastern Star and Secretary of the 
Progressive Methodist Association. 

I believe that I can meet the requirements of an executive in 
personal qualifications such as loyalty, reliability and business 
interest. Will you grant me the opportunity for a personal inter- 
view, at which time, I will be glad to answer all your questions and 
give you any further information you request about my qualifica- 
tions ? I will appreciate your reply. 

Respectfully yours, 
Marion Holman 

Sample Letter C 
New Process Rubber Company 

I am most anxious to call your attention to a young man thirty 
years of age, who after spending several years in the manufactur- 
ing and selling of rubber clothing, has definitely decided upon the 
Rubber Industry as his life work. 

Having had college training, with enough inside and outside 
work to sort of file the rough edges off, he feels that he is now ready 
to be placed in a specific sphere of the Rubber Industry. 

With proper training in your requirements, this man will make 
a life long asset to a reliable organization, as well as to himself. 

It may be that you are looking for this type of material in your 
organization. If so, I would be more than pleased to forward you 
any, or all, desired information that would lead to a profitable life 


Remuneration is secondary at this time. I will be available in 

Thanking you for this attention. 

Very truly yours, 
Claude Raymond 

Sample Letter D 

Mr. D. S. Kennard, President 
New Process Rubber Company 

Dear Sir: 

The correct interpretation of production costs in relation to 
sales, labor and tax policies is daily becoming of more and more 
importance. This requires men who are fitted by training and 
inclination to apply the principles of economics and science to the 
study of these policies. 
Would not a man: 

who has received his S.B. degree in engineering from the 
Mass. Institute of Technology; 

who has taken courses in accounting; 

who has been engaged in industrial engineering, mainly 
working at time studies, cost analysis, and graphical analysis of 
operating statement; 

who is at present employed as accountant by a firm of certi- 
fied public accountants, and who has been connected with this 
company for over a year and a half; 

would not such a man be of value in your organization? 
If such be the case, I wish you would consider my application 
for a position in your cost or industrial engineering department. 

I shall be pleased to send you further information or to arrange 
for a personal interview. 

Respectfully yours, 
Keith Pendleton 

Sample Letter E 
New Process Rubber Company 

For that gap in your organization where a new man is needed, 
not a top-sergeant in the business army, nor a captain, but, — a 
first lieutenant. 

One of your younger executives needs an assistant, someone 
capable of relieving him of much detail routine so that he can be 
free for greater accomplishment. 

You have a particular job of work that must be done, a job 
that needs young men with keen minds and a more than super- 
ficial knowledge of business procedure. 

You are looking over the " brain market" for a new material 
which you can introduce into your business with pleasure and profit. 


There is a spot in your organization where a new man with a 
fresh viewpoint would have a tonic effect, like a glass of buttermilk 
on a hot day. 

You wish to recruit, attract to your organization men of more 
than ordinary ability and capacity, men who are better than they 
look, who can accomplish what they set out to accomplish. 
Your want is filled. I am that man. 

Yours very truly, 
Theodore Prendergast 

Sample Letter F 

Mr. Gordon Randall 

Employment Manager 

New Process Rubber Company 

Dear Mr. Randall: 

Mr. Stuart Robertson, Director of the Department of Educa- 
tion and Vocation, has just informed me that there is an opening 
for a man with chemical training in your company, and stated 
that the opening salary would be $1,500.00 a year. Although I 
am employed at Boston University at the moment, I am inter- 
ested in obtaining an industrial position. I am working now as a 
part-time instructor in chemistry at a salary of $1,200.00 for ten 
months, and I accepted this temporary appointment with the 
reservation that I could be released if I should be offered a position 
in industry at a higher salary. 

I have received my B.S. and M.S. degrees in Chemical Engi- 
neering at Boston University, the former in 1932 and the latter in 
1934. During my graduate work, I took such courses as advanced 
organic chemistry, organic analysis, cellulose, and chemical micros- 
copy. My investigative work was in organic and electrochem- 
istry, the major part of it being in the latter on a problem of molyb- 
denum deposition at a mercury cathode. Since 1934 I have been 
assisting and instructing in general, elementary and analytical, 
and physical chemistry at this university. 

I am twenty-six years of age, single, and American citizen of 
English lineage. I have enclosed a recent photograph. 

As to my character and ability, you may refer to any of the fol- 
lowing professors at Boston University: 
(List of Names.) 

If my qualifications meet your requirements and you should 
desire a personal interview, I could make arrangements to meet 
you some Saturday morning at your convenience. 

I shall be glad to send any further information which you may 

Yours very truly, 
Burton Thompson 

Case 2. Julia Stanizzi 

(An employee brought pressure to bear on her foreman, who disregarded modern 
employment procedure and attempted to supersede the employment manager.) 

Characters : 

Mr. Randall, employment manager. 

Miss Stanizzi, a young applicant for employment. 

Mr. Sodergren, foreman, boot department. 

Please employ for the 

Employment Requisition 


No. 1 
For Position as 



Reason for increasing force 

to release a spare 


To begin work 

at once 19 

Rate to start .35 When Experienced .50 

With the following qualities: 

Julia Stanizzi 

To replace 

Transferred to 


No longer employed 

Promoted to 

Increase Forces: Yes, No. 
Send all applicants to 

Permanent: Yes, No. 
James Sodergren Foreman 


Department Head 


July 12 1937 

Position filled by 



One morning in July, 1937, a young girl stepped forward from 
the group of applicants in the employment office and handed a 
note to the employment manager. The girl sat down by the 
desk while the employment manager opened the envelope and 
found it to contain the employment requisition shown at the 
bottom of p. 27. 

Attached to the requisition was a brief note: 


Please hire bearer, Julia Stanizzi, for this job. 


Julia Stanizzi was a stranger to Mr. Randall, and the following 
conversation ensued: 

Randall: You have never applied here before, have you? 

Julia: No. 

Randall: I presume you talked with Mr. Sodergren this morning? 

Julia: Yes. 

Randall: How did you know that he had a job to fill? 

Julia: My sister took me in to see him. 

Randall: Oh yes, I see. Your sister's name is Stella, isn't it? 

Julia: Yes. 

Randall: How old are you? 

Julia: I'm seventeen. 

Randall: What is your height and weight? 

Julia: I think I weigh about one hundred and ten, but I don't know 

how tall I am. 
Randall: Do you mind standing up for a minute, Julia?. ... I'd 

say you're just about five feet tall. 
Julia: Yes, I guess that's right. 
Randall: How far did you go in school? 
Julia: I left school in the eighth grade. 
Randall: How long ago was that? 
Julia: That was a year ago last Christmas. 
Randall: Have you worked anywhere since you left school? 
Julia: Oh yes, I worked in the five and ten and I. . . . 
Randall: How long did you work there? 
Julia: Just during the Christmas rush. And then I worked in a 

restaurant for a while; but mostly I've worked taking care of 

children. I don't like that kind of work, though, and I'm so glad 

Mr. Sodergren is going to hire me. 
Randall: Did Mr. Sodergren tell you that we would have to approve 

your application first? 
Julia: He said something about making out a card. 
Randall: Well, Julia, I'm afraid Mr. Sodergren overlooked one point. 

He probably doesn't know that you're under eighteen. We really 

can't hire anyone under eighteen years of age. 


Julia: But I'll be eighteen in November. Could you hire me then? 

Randall: That's difficult to say. You see we have a long list of 
applicants, and we must select from this list according to qualifica- 
tions and jobs that need to be filled. I cannot make you any 
promise, and I doubt that there'll be a job open for you. 

When Julia Stanizzi had left the employment office, Mr. 
Randall telephoned the foreman. 

Randall: Hello, Jim. On that girl you sent over to see me, Julia 

Sodergren: Yes. I asked her sister to bring her in. She's been 
pestering me for a month and I had to do something. If the kid 
is anything like Stella she ought to be O.K. 

Randall: The principal difficulty, Jim, is that she's only seventeen 
years old. 

Sodergren: What difference does that make? 

Randall: Since the passage of the Walsh-Healey Bill we don't hire 
boys and girls under eighteen. 

Sodergren: Gosh, I didn't know that. 

Randall: Well, you see we've taken care of it right here in the employ- 
ment office by not accepting any applicant under that age. 

Sodergren: Well, it's too bad to disappoint the girl. 

Randall: That's true, Jim. I'm sorry you raised her hopes. It would 
have been a lot better if you'd just referred her to the employment 
office without any promises. As a matter of fact, Jim, I think I 
should have been inclined to turn Julia down anyway, regardless 
of her age. 

Sodergren: You would? What do you mean? 

Randall : I've got over a thousand applications on file here and plenty 
of girls on the list are much better qualified for an assembler's 
job than she is. 

Sodergren: In what way? 

Randall: That job of yours requires a tall girl with strong hands and 
ability to read tickets, count accurately, and memorize construc- 
tions. I have girls who are mentally and physically much better 
fitted than Julia. 

Sodergren: Well, of course, I never saw this Stanizzi girl until she 
showed up this morning, and I didn't want to disappoint her sister. 

Randall: The best way to take care of such requests is to refer the 
girls to me. Then if they don't get the job there's no harm done. 

Sodergren: O.K., Randy. No hard feelings, I hope? 

Randall: Not at all. But how about this job? D'you want me to 
get you a girl? 

Sodergren: Well, I don't know. As a matter of fact, I think I might 
be able to get by without getting anyone. Hold off for a few days 
and I'll let you know. 1 
1 For another illustration of the old-fashioned foreman's attitude to modern 

employment procedure, see Case 15, The Rinehard-Coughlin Case, pp. 89-91. 

Case 3. James J. Robinson 

(Different forms of "political" influence were used to persuade the employment 
manager to hire this man.) 

On May 3, 1937, the employment manager of the New Process 
Rubber Company received the following requisition specifying a 
certain James J. Robinson as preferred for the job: 

Employment Requisition 
Please employ for the 1080 Dept. 

No. 1 
For Position as 


Service Man 

Reason for Increasing Force : 

Style Changes 

To begin work 

at once 19 

Rate to start: .50 When 


.65 to .70 

With the following qualifications: 

James J. Robinson 

87 Park Avenue 


To replace 

Transferred to 


No longer employed 

Promoted to 

Increase Forces: Yes, No. 
Send all applicants to 

Signed: J. B. Hadley 

Permanent: Yes, No. 

O.K. F. G. R. 

Dept. Head 

Date May 3, 1937 

Position filled by 



James J. Robinson was not an employee of the company, nor 
did his name appear on the application files of the employment 
department. He was unknown to the employment manager. 

The employment manager did not accept or investigate the 
suggested candidate, since there was a surplus of young men in 
the employ of the company. He selected one of these young 
men as a suitable candidate and sent him to the foreman on a 
proposed transfer. The foreman, however, turned this man down, 
stating that he was not quite tall enough for the job. The candi- 
date was five feet and eight inches tall and the question of height 
had not previously been considered for the job in question. 

On May 4, 1937, the employment manager received a note 
from the vice-president, enclosing the following letter and expres- 
sing the hope that a favorable answer could be given. 

Mr. D. L. Bemis 

Vice President 

New Process Rubber Company 

Dear Mr. Bemis: 

I am greatly interested in the bearer, James J. Robinson of 
87 Park Avenue, Amberton, who is anxious to secure employment 
with the New Process Rubber Company. 

I have known Mr. Robinson for many years and know him to be 
capable, honest, and industrious. I feel that I can unhesitatingly 
recommend him to you. 

Anything you might do to assist him in securing employment 
will be greatly appreciated. 

Very truly yours, 
Bancroft Bentley 
Mayor of Amberton 

Later on the same day, Pete Singer, who was a cutter on the 
first shift and also a captain of the company baseball team, 
dropped in after work to see the employment manager. The 
following is part of the conversation that ensued: 

Randall: Hello there, Pete. How's the ball team these days? All 

set for the big game next month? 
Singer: That's what I dropped in to see you about. We just got to 

have a good pitcher, and I know where we can get one. All you 

have to do is to find a job for him. He's absolutely in the pink; 

nineteen years old and a good kid. His name is Jimmy Robinson. 

Case 4. George McCue 

(An illustration of direct political pressure.) 

Mr. Kennard, President of the New Process Rubber Company. 

Mr. McCue, town councilor. 

Mr. Randall, employment manager. 

On Monday, Feb. 8, 1931, Mr. Randall was called to the 
president's office. It was a busy morning, and he had to leave 
several hundred applicants waiting for interviews. In the presi- 
dent's office, seated beside the president's desk, was Mr. McCue, 
town councilor, a man well known to both the president and 
himself. The president explained the reason for Mr. McCue's 
presence : 

Kennard: Mr. McCue has registered a complaint against your depart- 
ment. He sent a man to see you this morning with a letter recom- 
mending him for a job. It appears that you interviewed this 
man very briefly and sent him away without offering him a job. 
He observed, however, that you were hiring a large number of 
men. Mr. McCue also stated that this is the sixth man he has 
sent to you during recent months, and that none of them have been 
hired. He feels that we are not cooperating with the efforts of the 
town authorities to relieve local unemployment. 
(To Mr. McCue) Does that state the case, Mr. McCue? 

McCue: It states it rather mildly. I'd like to know why Mr. Randall 
has never hired any man that I ever sent to him. 

Randall: It would be most unfortunate for you and I to have a mis- 
understanding, Mr. McCue, and I am very glad to have this 
opportunity to explain what we have been doing to help local 

The depression caused a tremendous shrinkage in our force and 
it is rather fortunate for the town that only 25 per cent of our 
employees were local residents. Otherwise the unemployment 
burden would have been considerably greater. However, 35 per 
cent of our rehired employees have been local residents because we 
have been giving them a preference. 

During the past year I have been sending a monthly list to the 
local unemployment office showing the names of local residents 
employed by us in the current month. If you would like to have 
a copy of the list that we send to the unemployment office, I would 
be very glad to supply you. 



McCue: That's beside the point, Mr. Randall. I'm not interested in 
the list of people you hire. I'm interested in the people you don't 
hire. The people I send to you are emergency cases on which 
employment must be supplied at once. I feel that I am asking 
no unreasonable favor when I ask a company of this size to employ 
one or two local men upon my recommendation. I recognize that 
they may not be first-class men. I recommend them to you not 
because of their qualifications, but because of their dire need. 
Their families are in distress. They simply cannot wait for weeks 
and months before getting a job. They must have it now. 

Randall: I appreciate the problem all right, Mr. McCue. It is 
significant, however, that the people in greatest distress are quite 
consistently the least capable. You may remember Luigi DiTocci 
whom you referred to me about six months ago. He's the man 
who had nine children at home and his wife in the hospital expect- 
ing another. It was right after the plant shutdown that you 
talked with me about him. 

McCue: Sure, I remember the DiTocci family. They live on Rosedale 
Street. DiTocci is a good workman all right. 

Randall: Well, as a matter of fact, he's not making out so well. We 
placed him early in October. During the four months that he's 
been here I have been obliged to transfer him four times because 
his work has been unsatisfactory. It is now becoming difficult 
to sell any foreman on the idea of taking him. As you probably 
know we can't require a foreman to take a man whom he considers 
unqualified. We've done everything we could to help Luigi. 
We've sent our nurse to his home frequently. She collected 
clothing for the children and in that way got several of them back 
to school again. I'm very much afraid, however, that we shall 
be unable to keep Luigi. 

McCue: Of course, I don't pretend to come here and tell Mr. Kennard 
how to run his business or to tell you how to run your job. But, 
surely, this DiTocci guy ought to be able to sweep the floor. 

Randall: That's true, Mr. McCue. I believe he could do that. 
But that is one of the jobs we have reserved for our long-service 
employees. While the depression decreased our total force con- 
siderably, it also increased the percentage of long-service men. 
We recognize an obligation to these men and give them preference. 
Furthermore, while we have rehired as many of our former 
employees as possible, we still have a great many who are capable 
and whom we have been unable to place. These problems increase 
the difficulties we face in trying to place a man who is lacking in 
ability, and who has never worked here before. We have every 
desire to assist the town and to cooperate with you personally, 
Mr. McCue. I am sorry that conditions have made it so difficult 
during recent years. 

McCue: I see your point, Mr. Randall. I came over to see Mr. 
Kennard this morning to get a picture of the situation at first 


hand, and also to make a personal appeal for this young man who, 
I know, deserves and needs a job. If Mr. Kennard can't help 
me, then I must find somebody who can. I'll try some of the 
smaller plants in town. Of course, if you should find that you 
could squeeze him in somewhere, I'd appreciate it. I'd appreciate 
it very much. 

Kennard: We're always glad to do what we can, Mr. McCue, and to 
tell you when we can't. Of course, employment managers are 
accustomed to be asked to do things they can't, and they some- 
times succeed in doing them. But when it comes to hiring they 
seldom make a promise. Mr. Randall doesn't because he hasn't 
any right to. You see he doesn't do the hiring. He selects 
candidates and recommends them to the department heads for 
employment. It is only when a department head accepts a man 
that he is really hired. Mr. Randall can't go to a foreman and 
say, "This is the man I've picked for you. Take him and like it." 
Neither can he say, "I wish you'd hire this man as a favor to 
George McCue." The man must possess some qualifications that 
Mr. Randall can sell to the foreman. Naturally, Mr. Randall 
will hesitate to exaggerate those qualifications because he doesn't 
want the foreman to lose faith in his future selections. So you 
see, we are making it rather difficult for Mr. Randall. I suggest 
that you pick out a dozen cases that you feel need immediate 
attention. Send the candidates to Mr. Randall and let him see 
what the possibilities may be of placing one or two. I'm sure 
he'll do the best he can. 

McCue: All right, Mr. Kennard. I'll work with Mr. Randall as you 
suggest and see what results we get. 

Case 5. Case of Attendants 

(A supervisor exerted pressure to hire an increasing number of college men on factory 


The duties of attendants consisted in supplying materials to 
operators engaged on machines or conveyor assembly and replacing 
spoiled materials or missing parts. On the efficiency of this ser- 
vice depended the continued operation of these mechanized units. 
Lack of material would result in shutdown. The attendants were 
also held responsible for timing the speed of each conveyor belt 
according to the style of goods manufactured. This required an 
intimate knowledge of styles and footwear construction. The 
job of attendant, therefore, offered young men excellent insight 
into the problems and methods of rubber-footwear manufacturing 
and was considered by management as a good training field or 
supervision. Among the requirements for this job was the pos- 
session of a high school education or its equivalent. 

During the general business recession in 1 930-1 933 when jobs 
were scarce, many college-trained men were satisfied to take the 
job of attendant, when ordinarily they might not have considered 
it. Mr. Campbell, supervisor of the gum footwear making depart- 
ment, found to his satisfaction that these men were particularly 
successful and quick to learn. Accordingly, during 1935, when 
business began to experience an upturn and hiring was resumed, 
Mr. Campbell came to the employment manager and insisted 
that he would consider none but college-trained men to fill 
attendants' jobs. He explained that many college-trained men 
were looking for work and that he saw no reason why he should 
not take the best there was available. 

The employment manager pointed out the danger inherent in 
this practice. It was no doubt true that many college-trained men 
would be glad to accept the opportunity to work as attendants. 
On the other hand, in the course of time, it was almost certain 
that ambitious college men would be unable to find an outlet for 
their training and capacity and become dissatisfied. Further- 
more, as soon as business conditions improved, these dissatisfied 



college men would take the first opportunity to find a better job. 
Then, if the department had too large a proportion of college 
men, their exodus would seriously handicap the supervisor. Mr. 
Campbell was not convinced and appealed to his superintendent, 
who carried the problem to the vice-president in charge of manu- 
facturing. The vice-president ruled that the number of college 
men employed as attendants should be limited to 50 per cent. 

Early in 1936, Mr. Campbell was disturbed by a growing un- 
rest among the attendants in his department. Complaints of 
discrimination and lack of advancement had reached the superin- 
tendent. The latter had discussed the situation with the vice- 
president, and both formed the opinion that the company was 
employing too many college men as attendants. Accordingly, 
the supervisor came to the employment manager to discuss the 
type of men that were being employed as attendants. The 
employment manager reiterated that it was unwise to employ 
too many college-trained men on such jobs but urged that the 
proportion of college men hired was not too great. Of the 25 
attendants in Mr. Campbell's department, for instance, 12 had 
graduated from college, 3 had a few years of college training, and 
the rest had graduated from high school. 

The employment manager pointed out that these jobs offered 
an excellent opportunity for a new man to become acquainted with 
footwear styles and manufacturing methods and problems, as 
well as management responsibilities. From this standpoint these 
jobs could be considered as promotional jobs. He suggested that 
the supervisor should discuss the opportunities afforded by these 
jobs with the men who were handling them. Mr. Campbell 
agreed to do this and called the 25 attendants together in a group 
for the purpose, addressing them as follows: 

It has come to my attention that some of you men have expressed 
dissatisfaction with your present jobs as attendants. I have, there- 
fore, called you all together to point out some of the advantages that 
these jobs offer you. You were purposely assigned to these jobs 
because we recognize that you all possess the qualifications for promo- 
tion. No jobs in production offer a better opportunity for you to learn 
production and management methods. If you were placed on a con- 
veyor operation or off in some corner running a machine you might well 
feel that you were not receiving an opportunity to advance yourselves. 
On your present jobs, however, you have more freedom between 


departments than any job I know of. You come in contact with 
supervision in various departments. You learn footwear construction, 
as well as quality and production control. If you take advantage of 
your opportunities you can pick up a great deal of information that will 
be of value in the future. 

As production volume increases, there are going to be openings 
either in office departments or on supervision in the factory. You men 
are now on promotional jobs and as opportunities such as I have men- 
tioned occur, every one of you will receive equal consideration for those 
jobs. Our employment manager, Mr. Randall, has assured me that 
you will receive such consideration. It is my advice, therefore, that 
you do everything possible to prepare yourselves for these opportunities 
so as to be ready when they arise. And if any one of you men has any 
questions at any time, I hope you will not hesitate to come and discuss 
them with me. We want to help you and I am only too glad to give 
you advice at any time that will be to your advantage. 

The men appeared to be well satisfied with these statements 
and expressed their appreciation to their supervisor for his interest 
in their welfare. 

Shortly thereafter, an opening developed in the production 
scheduling department. The employment manager reviewed the 
qualifications of each attendant for this job and finally selected 
three men from Mr. Campbell's group for interview. One of 
these three men was accepted and transferred to the job. 

As soon as this became known to the group of 22 attendants 
who had not been interviewed, they called in a body upon their 
supervisor and wanted to know why he had not kept his promise 
to the effect that they would all be considered for any opening 
that might occur. 

Case 6. Afternoon Shift versus New Equipment 

(A supervisor urged the advisability of an afternoon shift, which would have meant 
hiring women, mostly married.) 

Characters : 

Mr. Jahnig, division superintendent of light footwear. 
Mr. Randall, employment manager. 

In the summer of 1933, the New Process Rubber Company 
experienced a wave of increase in production. This occurred 
just before the adoption of the NRA Codes. New methods of 
production had been introduced during depression years, and 
insufficient equipment was available to handle the increased 
volume of business. It appeared that production was only tem- 
porarily accelerated by the code situation. Merchants antici- 
pated an increase in prices and rushed to place their orders before 
the codes went into effect. 

This led to the decision to operate an afternoon shift from 
4:00 p.m. to 10:00 p.m., thus permitting girls to be employed at 
hours within the state law. The law relating to employment of 
women read in part as follows: 

The hours of employment for women in factories, workshops, manu- 
facturing, mercantile or mechanical establishments shall not be more 
than 9 hours in any day, or more than 48 hours in any week. In 
manufacturing establishments work for women over 21 years of age 
must not begin before 6:00 a.m. and must not last later than 10:00 p.m. 

No women can be employed continuously for a period longer than 
6 hours without being allowed 45 minutes rest or lunch period. 

Little difficulty was encountered in hiring girls or married 
women to work this shift from 4:00 to 10:00 p.m. on five days and 
from 7 :oo a.m. to 1 :oo p.m. on Saturday, making a total of 36 hours 
per week. 

On Nov. 18, 1936, W. Jahnig came to the office of Mr. Randall, 
and the following conversation ensued: 

Jahnig: Mr. Randall, you remember the four to ten shift we operated 

in 1933? 
Randall: Yes, indeed. 



Jahnig: Is there any reason why we couldn't do the same thing again? 
The present accumulation of orders requires a substantial increase 
in production, and if we could run such a shift in our canvas 
footwear, stitching, and making departments, we could save pur- 
chasing and building some expensive equipment. 

Randall: There were objections that were really not very serious in 
1933, but would, I think, be serious today. 

Jahnig: In what respect? It's no violation of state law, is it? 

Randall: No, it isn't. The problem that I have in mind relates to the 
general effect of such a shift policy on our employee relations. 

Jahnig: How does that differ from 1933? 

Randall: The circumstances in 1933 made our four to ten shift neces- 
sary to management and desirable to employees. You may recall 
that nearly all business took a sudden spurt during the latter half 
of that year. We increased our force over 30 per cent during 
July and August, as you will remember. However, that was a 
temporary condition, and we were forced to drop an equivalent 
number of people in the spring of 1934. We had neither the 
money nor the time to build extra equipment because it would have 
lain idle during 1934. From that standpoint the shift was neces- 
sary to meet the production peak. From an employment stand- 
point, we hired 800 people who had been unemployed for a long 
time and were only too glad to get a job at any schedule of hours. 
Both production and employment conditions, in my opinion, are 
different today. 

Jahnig: The production situation is not greatly different, as I see it. 
It's a sudden increase in canvas footwear just as it was in '33. 
It will rise to a peak and fall off again as it always does. And as 
far as employment is concerned, there must be plenty of married 
women, for example, who would be glad to work from four to ten 
while their husbands are home to take care of the children. 

Randall: The production situation differs in this respect, as I see it. 
In '33 the canvas increase constituted an increase in total produc- 
tion volume for the plant and justified hiring. The present 
increase does not constitute an increase in total volume because 
it is offset by the falling off in winter footwear because of the mild 
winter we had last year. This does not justify hiring, in my 
opinion. It means transferring our present employees. 

Jahnig: If we can meet delivery dates on orders and avoid cancella- 
tions, our canvas may go to a daily production of 25,000 pairs. 
That would mean some hiring, wouldn't it? 

Randall: Yes, it might mean hiring around 100 people, but that would 
leave 400 that are here now, either in the department or to be 

Jahnig: Most of the people would still remain on the morning shift. 
We might not have more than 150 to 200 on the four to ten. 

Randall: True enough, but, as you know, we can't run an afternoon 
shift without at least a nucleus of experienced people. Further- 


more, I don't think it's good policy for us to hire married women 
whose husbands are working, when there are plenty of single girls 

Jahnig: I'm not aware that we ever had any policy against hiring 
married women. 

Randall: That's true enough. I'm not thinking of it from that stand- 
point. I'm thinking of at least three other things. The married 
women will not, on the whole, be as well qualified or as adaptable 
as the girls recently out of school. They will, therefore, not be 
an asset to our present program of employment stabilization. Due 
to limited qualifications or personal desire, the employment of 
married women will probably be temporary. Training costs, 
therefore, will represent a loss. The employment of these married 
women will also bring an unfavorable reaction from many of our 
employees who consider it unfair to hire both husband and wife. 

Jahnig: I can recognize these objections, Mr. Randall. But do you 
realize that it will cost us $50,000 for new equipment if we don't 
put on the extra shift? 

Randall: No. I didn't know it would run into such a figure. 

Jahnig: Well, it does and that's a very conservative estimate, too. 
Now, it seems to me that we ought to be very sure of our ground 
before we object to saving that expense. In the first place, what 
objections did you meet with in 1933 on account of the four to 
ten shift? 

Randall: Here are the objections as I remember them. We had to 
allow for trucking and delivery of materials between shifts. For 
this reason we had to begin our regular shift one hour earlier. This 
meant that the day crew had to start at 6:30 in the morning 
instead of 7:30. The transportation facilities were not so good at 
that hour in the morning. As a result, our employees had to allow 
more time to get here than usual. This meant crawling out of bed 
before daylight in many cases. Many of the girls objected to that, 
particularly when they'd been out the night before. I didn't hear 
so much objection from the men, but there aren't many men in 
these departments. This day crew worked eight hours a day for 
five days, giving them a 40-hour week in five days. 
The afternoon shift had a different complaint. The younger girls 
didn't like working until ten o'clock because it spoiled their 
evenings for dancing or the movies. In addition to this incon- 
venient hour they obtained only 30 hours work in five days. You 
remember that they didn't want to work Saturday night because 
they wanted at least one evening for entertainment. In order to 
remedy this we gave them a six-hour shift on Saturday from 7 :oq 
a.m. to 1:00 p.m. That meant that after going home on Friday 
night and getting their supper they got to bed around midnight. 
They had to get up between five and six o'clock the next morning 
in order to get to work at seven. Despite these inconvenient hours 
and six days at work, they had only a 36 hour week, and therefore, 


earned less money than the people who worked five days. They 
felt that they were getting the short end all around and kept 
pestering us for transfers. 

Furthermore, while the four to ten shift did not violate state law, 
it was evident that the practice ran counter to the intent of the 
legislators. Married women, for instance, put in more than nine 
hours a day. Their combined working period, at home and in the 
factory probably amounted to 15 hours or more. We found in 
many cases, that after a few months of working on the four to ten 
shift, women complained that it was quite a strain. 
We may have been able to hire or even transfer people to work an 
afternoon shift during the depression. But do you believe we 
could select people from our present employed group and transfer 
them to these short-end jobs without being flooded with claims of 
unfair labor practice and discrimination? 

Case 7. Andrew Beauchamp 

(An old employee of the company urged the employment manager to hire his son 
in preference to others who were better qualified.) 


Andrew Beauchamp, vulcanizer operator. 
Alfred Beauchamp, Andrew's twenty-year-old son. 
Mr. Randall, employment manager. 

Mr. Randall walked into his office at eight o'clock one morning 
to find Andrew Beauchamp seated by his desk awaiting his arrival. 
Andrew was a vulcanizer operator on the night shift and had 
apparently been waiting since the shift closed at seven. 

Randall: Good morning, Andrew. How are you? 

Beauchamp: Oh, I'm O.K., but I've got a favor to ask you. I've got 

a boy twenty years old that wants a job. He's had two years of 

business college, but he wants to quit and go to work. As a 

matter of fact I can't afford to keep him in school no longer. I 

need his help. D'you suppose you could give him a job? 
Randall: Well I'm afraid I can't be very optimistic right now, Andrew. 

You probably know that production has been dropping off recently. 
Beauchamp: Oh, I know things are quiet. I've been put on short time 

myself. That's why I need his help. But I know you can help me 

if you really want to. It's easy for a big company like this to find 

a job for just one man. 
Randall: Anyone we hire today would displace some employee already 

working. Since that is unfair we shall naturally have to wait until 

business improves before we do any hiring. 
Beauchamp: Mr. Randall, maybe you don't appreciate my request. 

I've worked for this company twenty years, and this is the first 

time I've ever asked a favor. It seems to me I'm entitled to some 

Randall: Don't misunderstand me, Andrew. I'm willing to give your 

boy some consideration provided we have a job that he's qualified 

to fill. . . . 
Beauchamp: Oh, I'll vouch for his ability, Mr. Randall. I'll vouch for 

that. You just tell me when he's to report and I'll see that he's 

Randall: Get this straight, Andrew. There isn't any job in sight at 

present, and I don't know when there will be. But I would like to 

have your boy come in to see me some day when it's convenient. 



I'd like to talk with him, and check up on his qualifications. But 

be sure and tell him that we have no jobs open at present. 
Beauchamp: I'll bring him in tomorrow morning, O.K? 
Randall: Yes, surely, if it's convenient. Tell him not to bring anyone 

with him. I want to talk with him alone. But if I shouldn't be 

here, Mr. Smith will talk with him. 
Beauchamp: O.K. and many thanks. I'll tell him. 

Next morning, Andrew Beauchamp brought his son Alfred 
into Mr. Randall's office. 

Beauchamp: I want you to meet my son, Alfred. 

Randall: Glad to. . . . 

Beauchamp: I told you I'd have him here this morning. I said to his 
ma last night before I came to work, I said: "Now it's up to you, 
ma, to get Alfred out of bed tomorrow morning or he won't get that 
job Mr. Randall's going to offer him." 

Randall: You understand, Alfred, that there are no jobs at present. 
Even, if there were jobs, you would have to prove yourself qualified 
before you would be considered. I asked your father to send you 
in so that we might talk things over and perhaps include your 
name in our application file. . . . How old are you? 

Beauchamp, Sr : He's twenty. He'll be twenty-one on the twenty- third 
of April. 

Randall: What is your height and weight, Alfred? 

Beauchamp, Sr: He's five foot six 'n weighs a hundred and thirty- two. 

Randall: That's fine, Andrew, but give Alfred a chance. 

Beauchamp, Sr: O.K. 

Randall: Tell me something about your school work, Alfred. What 
courses did you take and how did you make out? 

Beauchamp, Sr : Oh, what's the use talking about that? That was just 
a waste of money, Mr. Randall, that's all it was. He don't take no 
interest in school. Let's forget about that. It's a job he wants 
now, and, God knows, I need his help. What d'you think he 
can do? 

Randall: Andrew, I haven't the slightest idea what he can do. But if 
you'll let me, I'm going to try and find out. ... I tell you what, 
you go ahead home to breakfast and leave Alfred here with me. 

Beauchamp : O.K. O.K. I knew you'd fix him up. I ain't worked for 
this company twenty years for nothin', I guess. Well, so long, 
Mr. Randall, and much obliged. 

(To Alfred) Now speak right up, Alfred. Don't be afraid. 
(Andrew Beauchamp goes out.) 

Randall: Tell me, Alfred, is it true that you want to leave school and 
go to work? 

Alfred: Well ... in a way, yes. Might as well go to work and earn 
some money, I guess. There's really no fun going to college today 
if you can't have a little spending money. All the other fellers. 


Randall: Don't you think there is some advantage in the knowledge 
and mental training obtained? 

Alfred: Well, maybe, some. But it's not much use if you can't get a 
job, is it? 

Randall: If you get a job I suppose you'll help support the family? 

Alfred: Oh, I'd be willing to pay board until I'm twenty-one. After 
that a man has a right to look after himself first. 

Randall: I see. Well, I'm sorry to have to tell you that there's no 
possible chance of offering you a job here, at least for some time to 
come. And if I were you I wouldn't depend on it. You see, we 
have a considerable number of unemployed men whom we feel 
under some obligation to reemploy before we hire any new men; 
besides, they are experienced men. 

Alfred: Yes, that's what they all say. . . . 

Randall: Because it's true — you've got to face the facts. It really 
would be better for you to stay in school if it's at all possible- If 
not, you'll just have to make up your mind to cover a lot of 
territory before you land a job. Keep at it, and don't get dis- 
couraged. You'll get one some day, and the experience you get in 
hunting for a job will be worth a lot to you. (Rising, with the idea 
of terminating the interview.) If you want any help or advice, 
don't hesitate to drop in and talk things over with me. 

Alfred: (Hesitating at the door.) But, the old man told me he'd fixed 
it up so I'd get a job here. 

Randall: I'm sorry, but that's impossible at present. I thought your 
father understood that. Let me make it clear to you now that if 
you do want a job here you'll have to get it on your own initiative 
and because you possess the qualifications for the work that is 
available. That is the only basis on which men are employed here. 
If you are interested I shall be glad to have you get in touch with 
me occasionally. I'll help you with advice even if I can't help you 
with a job at present. Good day. (Returns to his desk.) 

Alfred stands irresolute for some moments and leaves the building. 

On the following day, Andrew Beauchamp was again waiting 
for Mr. Randall. 

Randall: Good morning, Andrew. 

Beauchamp: Good morning. Say, the boy tells me you turned him 

down flat. 
Randall: I'm sorry, Andrew, I couldn't offer him much encouragement 

at present. 
Beauchamp: Well, I think it's a damn shame to call a boy in here and 

raise his hopes of getting a job, and then turn him down flat. 

I think I ought to be entitled to more consideration than that 

after all the years I've worked here. 


Randall: I asked him to come in merely to determine his qualifications 
for future consideration. I made it very clear that we could do 
nothing at present. And- I'll be very frank with you, now, 
Andrew. Your boy lacks some very essential qualifications. His 
entire attitude toward work and life needs to be revised before he 
could ever become an asset to this company. I've suggested that 
he call in occasionally. I thought I might be able to help him in 
this respect. There's nothing more that I can do for him at 
present. What he needs more than anything is to learn how to 
stand on his own feet. 

Beauchamp: Well, I don't know, he's only a kid. But I still think you 
could give him a job if you really wanted to, considering it's the 
first favor I ever asked in 20 years. 

Randall: Did you know that we h#ve 500 men that have worked here 
for more than 20 years, and that some of the men have been with 
us for 40 years? 

Beauchamp: No. Is that a fact? 

Randall: Yes it is, Andrew, and most of them are family men. . . . 
And again I don't want you to misunderstand me. I'd like to 
help you. You're worried about Alfred. You're afraid he's 
losing interest in his school and in his family, and possibly getting 
into bad company, aren't you? 

Beauchamp: Well, I ain't sure about it all, but I figured out if only 
he could get a job with a good company it would fix everything. 

Randall: Well, I'm sorry that a job is definitely out of the question 
for the time being, but if he'll come over to see me once in a while 
so we can get better acquainted, I think it's possible that I might 
be of some help. 

Beauchamp: O.K. But don't forget what the kid needs is a job. 

B. Rehiring 


It had been a policy of the New Process Rubber Company to 
give former employees a hiring preference, because the company 
knew their ability and personal qualifications at first hand. In 
the past, former employees were rehired only for the same job 
they had held before or similar work. After 1934, a tested 
employee was considered for any type of work that came within 
his scope. 

When several former employees appeared to have equal qualifi- 
cations, the following criteria were considered in the order shown 

a. Unemployed in preference to those now employed elsewhere but 
desiring reemployment by the New Process Rubber Company. (Need 
for employment.) 

b. Residence. 

c. Length of service. 

Under section a, the company took no initiative in seeking to 
draw former employees away from current employment elsewhere 
and was particularly careful to avoid accepting former employees 
who were known to be working for a competitor in the rubber 
footwear business. Post cards recalling former employees always 
specified, "If you are not employed at present, we shall be glad to 
have you call at the employment office for an interview regarding 
work." The purpose of this policy was twofold. Employment 
on a new job might prove temporary on account of production 
conditions or the inability of the rehired employee satisfactorily 
to adjust himself to the new job. In such a case, the employee 
might be dismissed and left stranded between two jobs. This 
could not help but create ill feeling toward the company by the 
individual concerned as well as by the community who would hear 
of the case, thus damaging the company in its public relations. 
Secondly, the withdrawal of an employee from another company 



for the purpose of accepting employment with the New Process 
Rubber Company tended to injure the relations between the two 

The provision under b relating to residence came into play 
during the depression of 1930. About 22 per cent of the com- 
pany's employees were local residents, and an additional 45 per 
cent were residents of adjacent towns. This meant that the 
decrease in force during the depression placed a burden on the 
relief rolls in these areas, for which the company felt considerable 
responsibility. 1 Welfare departments kept closely in touch with 
the employment office in an endeavor to obtain work for former 
employees. The case of Giuseppe Di Giacomandrea is an 
example of the problems created under this aspect of the company's 
rehiring policy. The Beecher Case presents similar difficulties. 

1 See Appendix A, General Description of the New Process Rubber Company, 
"Residential Distribution of Employees," pp. 305-315. 

Case 8. Giuseppe Di Giacomandrea 

(A social agency urged the employment manager to rehire a person on relief. Diffi- 
culties with a union representative ensue.) 


Mr. Mario, union representative of the vulcanizing department. 
Mr. Randall, employment manager. 

The local welfare bureau sent the following letter to the 
employment manager: 

Mr. Gordon Randall Nov. 6, 1933 

Employment Manager 

New Process Rubber Company 

Dear Mr. Randall: 

This department is interested in the family of Giuseppe Di 
Giacomandrea. For the past eight months, Mr. Di Giacom- 
andrea, one of your former employees, has been a recipient of 
welfare aid in varying amounts to meet the needs of his family. 
We realize that his wife is employed by your company. How- 
ever, her income is insufficient to support their family of nine 
children. These children are not adequately clothed to attend 
school, and the family is without fuel for the winter. 

Mr. Di Giacomandrea is an intelligent and dependable citi- 
zen. He is willing and able to do any kind of work that you may 
offer. In so doing you will relieve this burden on the town and 
aid a most worthy cause. We hope that you will find it possible 
to re-employ him at an early date. 

Yours very truly, 
Mary McCue 
Social Worker 

On Dec. 15, an opening appeared for which Giuseppe might be 
considered qualified, and he was reemployed in the vulcanizing 
department. One week later, Luigi Mario came to the employ- 
ment manager. 
Mario: Last night Joe Paolera came over to my house. He wants to 

find out when he is going to be rehired. 
Randall: I understood that Joe was working for the ice company. 
Mario: He is, but he says he'd leave his job in a minute if he could 

come back here. 



Randall: There are still a lot of people that haven't got any jobs. 
Don't you think it's better to hire those people first instead of 
taking somebody that already has a job? 

Mario: That may be. But Joe, he doesn't see it that way. He heard 
about "Jackum" (Di Giacomandrea) getting a job, and he 
doesn't think that's fair. 

Randall: Does he know that Jackum has been unemployed for nearly 
a year, and that he has a large family to support? 

Mario : Oh, yes. Only he is mad about this. He knows that Jackum's 
wife works here and has had a job right along. He doesn't believe 
that's fair. He says Jackum never looked to find a job but just 
sat around and waited for New Process to call him back. He said, 
"I should worry — let the family go on welfare. Joe says he got 
a family too, — never asked welfare for one cent. He found work 
to do. The work he does now is only four days a week; pays half 
the money he earned here. Now with winter coming on he may 
be laid off any time. 

Randall: I can see his point of view, Luigi. Naturally he wants to 
better himself if he can. But the fact remains that he still has a 
job. He's fortunate that he hasn't had to ask for relief. I 
realize that Joe had a pretty good record and we'll be willing to 
take him back sometime. But I still feel that there are other men 
who are equally well qualified and who need the job more than 
he does. We have a lot of people living right here in town whom 
we ought to get off the relief rolls as soon as possible. 

Mario: Why should the company care where a man lives? Joe is a 
good worker. 

Randall: Well, you realize, Luigi, that we can't satisfy everybody. 
We make decisions on rehiring that we believe are fairest to all 
concerned. You'll have to tell Joe that we just can't make him 
any promise yet. 

Mario: How 'bout this husband and wife business? How do you 
answer that one? 

Randall: We have no reason to discharge Jackum's wife. She's an 
excellent worker and she has worked here for quite a while. But 
she can't support her husband and nine children. In fact, I 
doubt if Jackum can support them without her help. You know 
a lot of women are working today. Sometimes several people in 
one family are working, perhaps for different companies. We 
can't discharge somebody just because we know that other people 
in the family have jobs. 

Mario: Some families get all the breaks. Other families get nothing. 
That's too bad. It would be much better to treat everybody the 
same way. 

Randall: Well, of course, Luigi, we try to avoid hiring too many from 
one family. But in Jackum's case, I feel that our decision has 
been fair. 


Mario: What shall I tell Joe? 

Randall: Tell him he'll have to wait awhile. If conditions improve 

we may be able to hire him. But don't make him any promises. 
Mario: Well, you're not much help. What shall I do now? If I tell 

Joe what you said he'll say, "what's the matter, you're a hell-of-a 


Case 9. The Beecher Case 

(Pressure was brought to bear by the union to rehire one of its members.) 

Mr. Miskell, union representative. 
Mr. Randall, employment manager. 

On Jan. 9, 1935, Union Representative Hugh Miskell came to 
Mr. Randall with the following question : 

Miskell: Who's this guy, Beecher, that went to work in our depart- 
ment this morning? 

Randall: Beecher? Oh, yes, he was just rehired. He used to 
work in the boot department. 

Miskell: How long did he work there? 

Randall: I think he worked over there about two years. 

Miskell: Is he married? 

Randall: No, I don't think he is. 

Miskell: Why didn't you hire Moskowski? He worked in our depart- 
ment before. Besides, he's married and has two children to 

Randall: Beecher is much better qualified to fill the job for which he 
has been hired. 

Miskell: Yes, but Moskowski needs the job much worse than he does. 
Moskowski used to do this same job that you put Beecher on and 
Beecher never did it before. I don't call that fair. 

Randall: I know Beecher has never done this particular job, but he 
demonstrated his ability when he was here to handle this sort of 
job much better than Moskowski. 

Miskell: That may be, but Moskowski did the job well enough to be 
kept until the layoff came didn't he? 

Randall: Yes, he got by until the layoff. 

Miskell: Well, I think he should have the job. 

Randall: You think he should have the job because he needs it worse 
than Beecher does. Is that right? 

Miskell: Yes sir, that's just what I think. 

Randall: Well, Hugh, you'll agree with me that the success of any 
company depends upon the people who work for it, don't you? 

Miskell: Yes, I suppose so. But one man couldn't make much 
difference in this case. 

Randall: As a matter of fact, Hugh, one of my jobs is to see that each 
man we hire is the best I can find for the job. By selecting each 



man carefully, one at a time, they add up to a total working force 
that is efficient. If I start making exceptions I gradually reduce 
the effectiveness of the entire organization. Now, if Moskowski 
and Beecher were equally well qualified I'd take Moskowski 
because of his greater need. But I must always consider qualifica- 
tions first. 

Miskell: Do you mean you're not going to take Moskowski back at all? 

Randall: That will depend entirely on the qualifications of available 
applicants and the type of job I have to fill. 

Miskell: Would you hire a new man before Moskowski gets back? 

Randall: I might, if it were necessary in order to obtain the proper 

Miskell: I don't call that fair. 

Randall: Actually, Hugh, there's no obligation on the company to 
rehire a man just because he happened to work here before. 

Miskell: I think there is. 

Randall: That would mean, that if I make an error and employ a man 
who doesn't prove to work out as well as we had hoped, that the 
company is going to be saddled with a poor workman for the rest 
of his life. That wouldn't be quite right, would it? 

Miskell: Well, no, I don't suppose it would. 

Randall: As a matter of fact, your job and the job of every man here 
depends a whole lot on the capability of the other men he works 
with. Poor workmen turn out poor work and lose business for the 
company. That affects employment. It is one of management's 
responsibilities to select and hire those people who will contribute 
the most to the interests of the company. That responsibility is 
assigned to this department. We must use our best judgment in 
making selections, or else I fall down on the job. 

Miskell: Well, maybe you're right. But I still think Moskowski 
should be rehired. 


Statement of Practice at the New Process 
Rubber Company, Inc. 

Up to 19 16, transfers at the New Process Rubber Company 
entirely concerned personal, rather than economic issues. They 
were of three kinds: (a) transfers of promotion, (b) transfers of 
demotion, 1 and (c) remedial or salvage transfers. The first two 
were almost entirely intradepartmental and primarily depended 
on informal differences in social status. This informal aspect 
appeared most clearly in transfers of promotion. It was not 
always feasible to recognize individual merit by advancing a man 
to a higher job level (formal promotion) or by increasing his pay. 
The chief obstacle to the first measure was the scarcity of labor 
grades in semiskilled and skilled occupations. When a worker 
reached his " ceiling," there was no opportunity for formal advance- 
ment unless he was of supervisory caliber. In such a situation, an 
increase in pay would offer an alternative method of recognition. 
But, pay increases were possible only within well-defined limits. 
Otherwise they disturbed existing wage differentials and led to 
labor trouble. As labor organized, wage schedules became gen- 
erally known to all workers in a given department and were no 
longer wholly a private matter. There developed the practice of 
having each job carry its own rate. In this way, all workers 
within a certain labor grade doing a specified job could count on 
receiving the same rate of pay. Accordingly, when a worker in 
such a group received a " raise," his fellow workmen, regardless of 

1 The usual disciplinary demotion (see the case of Alfredo Bonaccio, pp. 125-127) 
seldom offers grounds for misunderstanding. It may, of course, involve a problem 
of adjustment, but even this, ordinarily, is a clear-cut situation. A more subtle 
difficulty is created in cases of technical demotion of marginal workers where there 
is a conflict of attitudes. The worker cannot see beyond the loss of money and 
social status, which are all demotion means to him, and he, therefore, feels a natural 
resentment. Management, on the other hand, realizing that logically the marginal 
worker merits discharge, is conscious only of its own good will and loses sight of the 
technical demotion and the worker's attitude toward it. The case of David Walsh, 
Jr. illustrates this problem, (pp. 65-67). 



individual differences in skill and efficiency, considered themselves 
entitled to the same increase. If this was withheld they com- 
plained of discrimination. Both these conditions made it difficult 
for the foreman to recognize and reward individual merit as freely 
as he might wish. One way of getting around these difficulties 
was to avail himself of informal differences in social status and 
make the reward of a more intangible but nevertheless accept- 
able nature. For instance, a man might be transferred from the 
night to the day shift, or from a dirty to a clean job. Other 
transfers permitted a worker to acquire greater skill and to pre- 
pare himself more readily for a formal advancement to another 
job level. 

Demotions usually meant a pay cut as well as loss of formal 
status. 1 There were instances, however, when a man was dis- 
ciplined by being transferred to a socially less desirable job, place, 
or hour of work. 

A third ground for transfer was a worker's need for readjust- 
ment. These remedial transfers were usually interdepartmental 
and referred to an individual who was in difficulty for reasons 
either personal or technical. If an employee failed to get along 
with his foreman or co-workers, or if he did not measure up to 
certain technical job requirements, he was usually dropped from 
the department and discharged as incompetent. Sometimes, how- 
ever, he was given another chance in some other department. 
Such remedial transfers were obviously not preventive and were 
merely an attempt to rectify an error in placement. 

In arranging a remedial transfer, supervisors often disguised 
their motives after the manner of a horse trader. A foreman who 
wished to side-step the disagreeable task of coping with a misfit 
might attempt to palm him of! on another supervisor. He would 
extoll the worker in question and enlarge upon the advantage 
of hiring an experienced man rather than a greenhorn. In addi- 
tion, he seldom failed to offer a plausible excuse for having to 
transfer the worker out of his department. Subsequent experi- 
ence with such a transferred employee was likely to be unfavorable. 
This happened often enough to make foremen suspicious of all 
interdepartmental transfers. 

With the establishment of the employment department, all 
transfers became a function of the employment manager. In 

1 See Case 22, Alfredo Bonaccio, pp. 125-127. 


following up employees the employment manager not only coop- 
erated with the foremen in the use of the above-mentioned trans- 
fers but developed a new type. This was the production transfer, 
which grew out of company policy and was wholly interdepart- 
mental in character. To avoid the losses and insecurities caused 
by excessive hiring and layoff in separate departments, the employ- 
ment manager filled as many requisitions as possible by transfer. 
In its early stages, this policy was not very successful because the 
employment manager could only draw upon marginal workers 
who would otherwise be dropped. The unsatisfactory results of 
such placements increased the disfavor with which supervisors 
already regarded interdepartmental transfers. 

In 1934, the management of the New Process Rubber Com- 
pany adopted employment stabilization as a major objective in 
labor relations. The achievement of this objective depended on 
the successful coordination of production scheduling with employ- 
ment procedures and the development of a highly versatile and 
efficient labor force that could be shifted from one type of work 
to another in accordance with production needs. This required 
a considerable amount of training and education. Workers had 
to be trained in several different jobs, and not only workers but 
also supervisors had to be convinced that production transfers 
transcended individual and departmental interests. The develop- 
ment of this attitude, that workers were in the employ of 
the company as a whole rather than any particular depart- 
ment, was one of the most difficult tasks of the employment 

The following cases illustrate the different types of transfer. 
For obvious reasons only comparatively recent instances are 

Case 10. The Case of Viola Burns. Transfer of Promotion. 

Case 1 1 . The Case of David Walsh, Jr. Transfer of Demotion. 

Case 12. The Thompson Case. This is a remedial transfer 
that is initiated by the department supervisor. The depart- 
mental difficulties are of a more basic nature than the obvious 
personal maladjustment of the employee, and his transfer fails' 
to solve the problem. 

Case 13. George Henderson. This is a remedial transfer that 
is initiated by the employment manager. The transfer is success- 
ful but raises a production difficulty. 


Case 14. Stitching Department Transfers. These production 
transfers are illustrative of the many problems raised by an experi- 
ment in employment stabilization. 

Cases 15 and 16 are specific illustrations of the mechanism 
involved in production transfers. 

Case 15. The Rhinehard-Coughlin Case. This illustrates 
transfers into a department, following an increase in departmental 

Case 16. The Kelly -Flanagan Case. This illustrates transfer 
out of a department, following a decrease in departmental activity. 

Case io. The Case of Viola Burns 

(A transfer of promotion.) 

Mr. Birdsall, paymaster. 

Miss Burns, typist. 

Mr. Randall, employment manager. 

In June, 1935, Viola Burns was hired directly upon her gradua- 
tion from high school and placed in the pay-roll office as a typist. 
She was intelligent, quick, cheerful, energetic, and had a pleasing 
manner but looked delicate and was somewhat unprepossessing 
at first sight and somewhat lacking in self-confidence. The pay- 
master had asked for a girl who was good at figures, could type 
with reasonable speed and accuracy, and do shorthand. Viola 
more than met these qualifications. 

There were twenty girls in the paymaster's office, and Viola 
readily made friends with all of them. She not only adapted her- 
self quickly to the job but evidently enjoyed the work. She was 
usually the first to arrive in the morning and was frequently 
spoken to for her failure to quit work at noon or at night. She 
became an asset to the department head and within a year had 
demonstrated to the employment manager that she was in line 
for promotion. Consequently, when Mr. Randall received a 
requisition for a secretary to one of the sales executives, Viola 
Burns immediately came to his mind. He went to the paymaster, 
Mr. Raymond Birdsall, and suggested Viola's release for transfer. 

Randall: Ray, I have a requisition from Jim Wagner's office for a 

bright girl to replace Agnes Brown who is leaving to be married. 

I think Viola Burns is just the girl for the job. 
Birdsall: Hell, Randall, that girl is practically indispensable to me. 

She's one of the best girls I ever had. You don't think I'm going 

to let her go, do you? 
Randall: How much are you paying her, Ray? 
Birdsall: Twenty-one dollars. 
Randall: But, you're not going to stand in her way if she has a chance 

for a better job and more money, are you? 
Birdsall: Well, maybe I could pay her more money myself. 



Randall: Maybe you could, Ray. But you're limited to the top rate 
for her present job classification. You can't pay her what she 
may eventually receive as a private stenographer. 

Birdsall: No, of course not. . . . Damn it all, the good girls always go. 
I sometimes wonder if I'd be better off to take girls that aren't 
quite so good, so I could keep 'em around here after I've spent 
time and money training them. 

Randall: Well, here's your chance to decide. If I take Viola, you'll 
need a girl to replace her. Tell me what you want and I'll find 
just the right candidate for you. 

Birdsall: Well, I suppose there's only one answer. You'll have to 
take Viola. After all, I've got to give her the break. But you 
find another girl just as good as she is, if you can. I guess I'm 
better off to hire bright girls even if there is a chance that I may 
lose them. 

Later in the day, Viola Burns was called to see Mr. Randall 
in his office: 

Randall: Good morning, Miss Burns. Have a chair. I have a sugges- 
tion to make which, I believe, will please you. Do you know Miss 
Brown in Mr. Wagner's office? 

Burns: Not very well, but I know who she is. 

Randall: Well, she's leaving us very soon — getting married — perhaps 
you have heard? I have suggested that you be considered to take 
her place. But whether or not you get the job depends on three 
conditions. The first is Mr. Birdsall's consent to release you; the 
second, your own willingness to give it a try; and the third, 
Mr. Wagner's acceptance. I have talked to Mr. Birdsall and that 
part of it is O.K. Now I want to tell you something about this 
job before you make up your mind. If you do well you would 
become Mr. Wagner's private stenographer, and be the only girl in 
his office. This is quite a change from your present job and you 
might feel rather lonesome. Mr. Wagner's work requires a con- 
siderable amount of detail. You would have to get acquainted 
with many customers, their accounts and requirements, with styles, 
prices, and discounts. You would handle his correspondence, keep 
his files, and run the office when he is out of town. This would 
involve contact with customers in person as well as over the tele- 
phone. If you should be transferred to this job you would receive 
a slight increase in salary at once, and more later if you do well. 
Do you think you would like to try this job? 

Burns: Really, I don't know, Mr. Randall. It sounds like a lot to 
learn, and so different from what I've been doing. I'd hate to fail. 
You know more about it than I. Do you think I could do it? 

Randall: I'm very sure you can do it if you want to. 

Burns: Is there much dictation? 


Randall: Yes, there's a good deal. But I'm sure you can handle that 
part of it. And, of course, Miss Brown would be with you for a 
couple of weeks to show you the ropes. How about it, would you 
like to give it a try? 

Burns: Well . . . it's awfully hard to say, Mr. Randall. Could I 
think it over and let you know later? 

Randall: Certainly, Viola, just let me know in a day or so when you've 
made up your mind. 

At the end of two days, Mr. Randall had heard nothing fur- 
ther from Miss Burns. He spoke to Mr. Birdsall during the 
lunch hour. 

Randall: Oh by the way, Ray, has Viola said anything to you about 
taking the job in Wagner's office? 

Birdsall: No, she hasn't, but I certainly hope she'll make up her mind 
about it pretty soon. She's not much good to anybody since you 
spoke to her. She goes around looking like she's lost her last 
friend. She even cries about it. I believe she feels she ought to 
take a chance but hates to leave the department and her friends. 

Case ii. The Case of David Walsh, Jr. 

(A transfer of demotion) 

In 1936, David Walsh, Sr., had worked for the New Process 
Rubber Company for 25 years as an engraver. He had never 
been in good health and in recent years had been able to work only 
half time. In view of his long service with the company and a 
large family of eight children ranging from a newborn baby to a 
son twenty-one years old, every effort had been made to adapt 
Mr. Walsh's work schedule to his physical limitations and family 
needs. He lived in a company house close by the plant. His eld- 
est boy had been with the company since 1934. Recently, his 
eighteen-year-old daughter Alice had entered the company's 
employ, and David, Jr., (age nineteen) was hired as an office boy. 
The family had struggled to get David, Jr., through high school, 
and the boy had succeeded in graduating in June, 1936, although 
his scholastic standing was below average. 

The company had followed the practice of employing high 
school graduates for messenger service and training them at the 
same time to fill minor office positions. A short period each day 
was devoted to teaching office boys how to run office machinery 
(Markem and Multigraphing machines, etc.). In this way, office 
boys were enabled to qualify for promotion. 

After six months' service as an office boy, David Walsh, Jr., 
was promoted to the production scheduling department, where his 
duties consisted alternately in operating a Markem machine and 
a Multigraph machine. The Markem machine was used to print 
lot numbers and pairs of shoes per lot on coupon tickets 1 for the 
stitching department. This work required clerical accuracy, 
because the coupons were used as a basis for figuring the daily 
earnings of stitchers. The Multigraph machine required less 
clerical but more mechanical ability. At the time of his transfer, 
David's pay was increased from $12 to $15 per week, and was 
subsequently raised to $18. 

In September, 1937, David had been employed on this work 
for nine months. In the meantime, his father had died, leaving 
1 See Appendix A, General Description of the Plant, Coupon System, p. 312. 

6 S 


the three children to support the family of nine persons. As a 
further misfortune for David, the recession had begun to affect 
production volume, and his name came up for layoff consideration. 
His work was the poorest among several boys engaged in similar 
work, and his department head had accumulated a large folder 
rilled with evidence of his many clerical errors on the Markem 
machine. In discussing David's case, the office manager and the 
employment manager decided to protect David against layoff by 
transferring him back to his former job as an office boy. This 
transfer involved a decrease of $5 in his weekly pay but protected 
his weekly earnings of $13, which were greatly needed for the 
support of the Walsh family. David accepted the demotion under 
protest and complained that the office manager had collected a 
folder full of errors with the idea of "framing him." Investiga- 
tion by the employment manager, however, had definitely verified 
the errors as David's. He had failed to meet the clerical require- 
ments of his job, although he had demonstrated considerable 
capacity for the mechanical phases. David was aware only of his 
good qualities and insisted that he couldn't have made so many 
clerical mistakes as were alleged. He stubbornly maintained 
that his boss "had done a job on him" to protect another employee 
who had a pull. 

Several other employees who also had received notice of layoff 
from the production scheduling department looked upon the situa- 
tion in an entirely different light. They had witnessed David's 
errors at first hand and complained that it was unjust to protect 
his employment. They protested that it was unfair in the first 
place for the company to employ three people from the same 
family and accused the company of favoring David because he 
lived in a company house. 

At this stage of the case, the employment manager was visited 
by David's younger sister Alice, who was employed in one of the 
factory departments: 

Alice: Mr. Randall, I really don't know how to begin. I want to talk 
with you about David. But I want you to understand how much 
we appreciate what you've done for him. I know he doesn't 
appreciate it, but mother does. She wanted me to tell you, and 
she thought maybe you'd talk with David. I think he'd listen 
to you. At home, he does all the talking and he just won't listen 
to reason. He never would, he's so headstrong. He's difficult to 
get on with. D'you know what he did today? He came home to 


lunch and wouldn't go back to work. We couldn't make him. 
He said . . . well, he said, "To hell with the job" and other worse 
things. I told him he'd get fired for sure if he didn't come back, 
but I just couldn't do anything with him. I wouldn't blame you 
if you did fire him. But I don't know what we'd do at home if you 
did. You know how things are since Dad died. Mother's had 
a nervous breakdown and she hasn't got any strength in her legs. 
She can't get out of bed. It keeps me pretty busy. Joe helps. 
You know Joe, down in the cutting room. Well, Joe puts on an 
apron and helps around the house. But not David. Oh, no. 
He wants to be waited on hand and foot. He's always been like 
that. You see he's got everything all wrong. Somebody must 
talk to him. Couldn't you give him another chance? 

Randall: I think I understand David pretty well, Alice. And what 
you've told me helps a lot. I'll be glad to talk to him. You tell 
him to come in and see me the first thing tomorrow morning. 

Alice: Thank you, but . . . ah . . . well, he hates to have his kid 
sister meddle with his affairs. You know, I want to help him, 
but, somehow. . . . 

Randall: I understand, Alice. You get him back to work tomorrow 
morning if you can. You won't have to say anything about me. 
I'll send for him to come and see me some time during the day. 
And I'll leave you out of it if you think it will work better. 

Alice: Oh, I'm sure it will. He can't help but listen to your advice. 

Randall: All right, Alice. I'll do what I can. And please let me 
know if things go any better. 

Mr. Randall then went to see Mr. Dickson, the office manager 
for whom David worked and explained the situation. It was 
arranged that both should talk to David on his coming to work 
next day. 

That day, the employment manager sent for David in the 
afternoon and found him very much on the defensive. By 
emphasizing David's mechanical ability and demonstrating that 
he was weak in clerical work, the employment manager finally 
convinced the boy that his contemplated layoff had been justified. 
Mr. Randall then explained that the transfer to his former job 
was not a punishment but a friendly effort to help him and his 
family and should not be looked upon as a demotion. David's 
attitude changed as he became convinced of Randall's genuine 
interest and, together, both worked out a constructive educational 
program. David decided that by taking a course in electrical 
work he could develop his mechanical ability and prepare himself 
for a better job. 

Case 12. The Thompson Case 

(A remedial transfer that was initiated by the department supervisor. The depart- 
mental difficulties were of a more basic nature than the obvious personal malad- 
justment of the employee, and his transfer failed to solve the problem.) 


Mr. Coleman, division superintendent. 
Mr. Thompson, machine operator. 
Mr. Randall, employment manager. 

On May 21, 1936, Robert Coleman, division superintendent, 
came to Mr. Randall, employment manager, with the following 
request : 

Coleman: Tom, you'll have to find a transfer for Conroy. He's 
George Daley's (the foreman) brother-in-law, and the rest of the 
boys who work for George don't like the idea. Conroy is making 
more money than the others, and they accuse Daley of playing 
favorites. I know all this is the bunk. Conroy is an excellent 
worker and is worth every cent he is paid. I suspect the boys are 
a little jealous because they know he's a better worker than they 
are. However, they complain that Conroy is favored with all 
the fat rates, and we've got to stop their mouths. The only way 
to do this is to transfer Conroy. But I think we ought to find him 
a job where he can make at least $35.00 a week. This whole busi- 
ness is no fault of his, and I don't think he should suffer financially. 

Randall: I agree with you, Bob. And it ought not to be difficult to 
find a suitable place for Conroy. As a matter of fact, haven't 
you got a similar case in B-15? If I remember correctly, Harry 
Thompson is working for his uncle, Bill Dawson. 

Coleman: That's right. But nobody's complaining about that. The 
men in Bill's department haven't raised any objections at all. 

Randall: That's surprising, for I think you'll agree that there's been 
more cause for objection in that quarter. Hasn't Bill been 
favoring Thompson with some rather soft jobs? 

Coleman: Yes, Bill has possibly been at fault in that respect. But 
apparently none of his men have seen anything to complain of. 

Randall: Nevertheless, why can't you exchange Conroy and Thomp- 
son and clean up this relation problem throughout your division? 

Coleman: I have no objection. The only trouble is that their jobs 
are quite dissimilar. I don't see how they would fit. Conroy is a 
bright boy all right and can easily handle Thompson's job. But 
I doubt whether Thompson has the ability to take Conroy's place. 



Randall: Well, the most important thing in my opinion is that Conroy 
can handle Thompson's job. Conroy has not been at fault and 
we don't want him to be the loser. In Thompson's job he has a 
good opportunity to earn the same rate of pay he's been getting and 
perhaps a little more. On the other hand, I doubt if Thompson 
rates Conroy's job anyway. McQueen in Daley's department 
does. Why don't you advance him to Conroy's place. Then we 
can make any other transfer necessary to arrange a suitable place 
for Thompson in Daley's department. 

Coleman: I don't see how we can do that and give Thompson the same 
rate of pay he's getting now. 

Randall: Is there any reason why we should protect Thompson's 
earnings? He's been favored long enough. I should think it's 
about time he learned to stand on his own ability. 

Coleman: Well, let's give it a try. I'll suggest to Daley and Dawson 
that they take steps to arrange these transfers. 

The situation was handled as indicated above, with the follow- 
ing results: Daley's department lost a capable man in Conroy and 
for over a month experienced a letdown in production. Conroy 
handled his new job successfully and quickly made a place for 
himself in Dawson's organization. 

Thompson, on the other hand, was much upset by the change. 
He lost 12 pounds in three weeks, was treated by the company 
physician for nervous indigestion, and entered a complaint with 
his union representative. He stated that not only was he losing 
money by his transfer, but also he was much upset by suddenly 
finding himself in a hotbed of unrest and dissatisfaction. He 
earnestly requested that steps be taken to help him get back his 
former job. 

On July 6, 1937, Thompson made an appointment with the 
employment manager. He came into the office at the close of 
his day's work. 

Randall: Well, Thompson, what can I do for you? 

Thompson: Say, I wonder if you realize what a hotbed you dumped me 
into down there in Daley's place. It's a regular clique of old 
biddies, every man watching the other fellow instead of doing his 
own job. They're all jealous of each other; all out for number one 
and trying to grab off the soft jobs. And Daley's the queerest 
foreman I ever saw, running around like a hen with its head cut 
off and doing a lot of jobs that he should assign to the men. Every- 
body but him tells me what to do and orders me around till I'm 
just about ready to go nuts. What you ought to do is to transfer 
half of them out of there and put in another foreman. I suppose I 


shouldn't be telling you what to do, but I wish to hell you'd send 
me back to Dawson. When I worked for Bill, nobody ever said 
a word about him being my uncle. Everybody got along swell 
and attended to their own business. These guys in Daley's place 
know why I was transferred and they're all the time rubbing it in. 
What d'you say, Mr. Randall, couldn't I get a transfer out of 

Case 13. George Henderson 

(A remedial transfer that was initiated by the employment manager. The transfer 
was successful but raised a production difficulty.) 

Until December, 1936, George Henderson had always been 
employed by the New Process Rubber Company as a molder. 
This work, however, had always been highly seasonal, causing 
periods of unemployment. The busy season generally began 
about June and lasted to the beginning of winter. One factor 
tending to prolong the season was that the New Process Rubber 
Company not only made overshoes but also supplied radio parts. 
Retailers stocked radios for the Christmas trade and, therefore, 
from a manufacturing point of view, the autumn months were the 
peak of the season. Efforts to stabilize production in the molding 
department had been unsuccessful. 

George Henderson was considered an experienced heel molder, 
whose ability, during the busy season, was in great demand. At 
such times he was able to earn 78 to 80 cents an hour. However, 
not only during a general business recession, but also during the 
annually recurring slack season, George Henderson suffered from 

On Feb. 25, 1937, George Henderson appeared at the employ- 
ment office of the New Process Rubber Company in search of 
"any kind of work," stating that he and his family were at the 
end of their resources and heavily in debt. He was employed as 
a laborer. 

Shortly after his reemployment, the employment department 
received bills from various of his creditors, some of them in the 
form of trustee writs. It became necessary, therefore, to call 
Mr. Henderson to the employment office to discuss the situation. 

The total amount of indebtedness known to the company was 
$265.58. In order to avoid wage attachments it was necessary 
to satisfy his creditors with small weekly payments. These were 
arranged as shown in the table on p. 74. 

Mr. Henderson occupied one of the company's houses, which 
were being managed by the Realty Company. He 



owed seven months rent. The employment manager arranged 
to deduct an additional $9.75 per week from Mr. Henderson's 
pay. This was for current rental and to pay a small amount on 
back rent. 

Amounts Owed by George Henderson to Various Creditors and 
Statement of Weekly Deductions from His Pay 

Amount Owed Payment 

Furniture company $133 .12 $2 . 00 

Clothing store A 37-96 1 . 00 

Clothing store B 10.00 0.50 

Clothing store C 26.05 1 .00 

Clothing store D 23 . 45 1 . 00 

Phillippi, grocer 35 . 00 o . oo l 

Total $265.58 $5.50 

1 Mr. Phillippi, a small grocer, was satisfied with the assurance that payment was contem- 
plated and agreed to wait until some of the other debts had been paid. 

In an effort to assist Mr. Henderson's financial situation, the 
employment manager also employed his eighteen-year-old daugh- 
ter who had just graduated from high school. She was employed 
as a form layer in the preparatory department. After a period of 
three weeks training she proved unsuccessful and had to be dropped 
from the employment roll. 

Approximately three months later, the employment manager 
found other work for which she was better fitted, and she was 
reemployed as a trimmer in the glove department. This work 
she did reasonably well. She continued to work in this depart- 
ment until a decrease in production necessitated her layoff on 
July 7, 1937. The employment manager was able to find other 
work for herlin the preparation of heavy footwear, and she was 
reemployed on July 11, 1937. 

A short time after the employment manager had arranged 
the deduction of weekly payments to satisfy Mr. Henderson's 
creditors, Mr. Henderson called at the employment office and vol- 
unteered the statement that he was in further difficulties. Reluc- 
tantly, he divulged that in 1936, in order to straighten out his 
finances, he had taken in a roomer on the condition that he put 
in a radio on which the roomer agreed to pay the installments. 
To carry out this agreement, Mr. Henderson had gone to the 
Clarion Talking Machine Company and purchased a radio, which 
was priced at $150, on the installment plan. For a period of six 
months, the roomer had faithfully made the payments. Then he 
suddenly disappeared, leaving an unpaid balance of $75. For 


some time past, the Clarion Talking Machine Company had sent 
letters requesting further payments. Recently, the credit man- 
ager had threatened to start legal proceedings. 

Mr. Henderson was advised to allow the Clarion Talking 
Machine Company to repossess itself of the radio. This he 
refused to do, saying that his wife had got so used to the radio that 
she could not bear to live without it. An arrangement was made 
for payments of $1.00 per week until such a time as a reduction in 
other debts might permit an increase. 

In view of Mr. Henderson's financial situation, the employment 
manager was desirous of assuring him continued employment. It 
was decided to employ him as a material handler at some addi- 
tional training expense to the company and a loss in average 
weekly earnings to the man, compared with his maximum earnings 
as a molder. When he could qualify as an experienced material 
handler, Mr. Henderson would be able to earn 70 to 73 cents an 
hour. This, however, would necessitate Mr. Henderson's giving 
up his occupation as molder. Mr. Henderson fully understood 
and readily accepted this condition, since he realized that to him 
security of employment was fundamental. 

On July 25, 1937, the foreman of the molding department 
urgently requested Mr. Henderson's services. There was a 
scarcity of skilled molders, and the foreman experienced great 
difficulties in keeping up production. 

Case 14. Stitching Department Transfers 
an experiment in employment stabilization 

(Production transfers that illustrate the many problems raised by the New Process 
Rubber Company's experiment in employment stabilization.) 

The New Process Rubber Company manufactured two highly 
seasonal lines of footwear; canvas or summer footwear, and rubber 
or protective footwear for use in winter. Whereas the manufac- 
ture of canvas footwear required a considerable amount of stitch- 
ing, rubber footwear required practically none. As a result, 
stitchers were employed only during the summer-footwear season, 
which generally began late in October, reached a peak during 
March, and ended in May. It was the custom in the stitching 
trade for workers to move from plant to plant according to sea- 
sonal demand for their skill. But unlike the regular migration of 
caterers to tourists, for instance, (some of whom regularly move 
from Florida to Maine and back again each year) , the movements 
of stitchers could not be systematic. Demand for their services, 
by companies manufacturing wearing apparel or other stitched 
articles, was also subject to wide seasonal variations, which fre- 
quently failed to coincide with the making of summer footwear. 
Consequently the stitchers at the New Process Rubber Company 
were certain of employment only during the canvas-footwear 
season. Even if they were so fortunate as to find work for the 
summer months, there was almost certain to be an interval of 
unemployment between jobs, which varied with the condition of 
the labor market. This caused a considerable loss in annual 
earning capacity. A further loss of earning power was sustained 
during the necessary periods of adjustment while the stitchers 
were being acclimated to new plants and attaining skill in manipu- 
lating new materials. 

From the point of view of management, this condition created 
a chronic problem in labor relations. In the first place, labor 
turnover among the stitchers in the New Process Rubber Com- 
pany had always been excessive, as can easily be seen from the 
following table: 


7 8 


New Process Rubber Company, Per Cent of Monthly Labor 
Turnover in the Stitching Department during 1930 and 1931 














12. 2 









20. 2 






Secondly, each season brought with it the difficulty of rinding 
an adequate labor supply of experienced stitchers. Many of its 
former employees had found other work by the time the New 
Process Rubber Company again required their services. This 
meant hiring a considerable number of stitchers who were unac- 
quainted with plant methods or with the specific stitching oper- 
ations required on canvas shoes. As a result, training schedules 
had to be repeated each year during this period of readjustment. 
This resulted in a serious financial loss. Each season, manage- 
ment was faced with heavy training expenses and excessive labor 
costs, damaged machines, wasted materials, and a high percentage 
of " seconds" 1 in the finished product. 

These difficulties were accentuated by the fact that manage- 
ment also had to cope with similar problems in the manufacture 
of rubber footwear. The production of winter footwear was 
usually started in May, reached its peak during July and ended in 
November. On account of shrinkage in production of rubber 
footwear, shoemakers were likely to be laid off at about the same 
time that stitchers were being hired. Many of these rubber- 
footwear makers drifted into other employment and were not 
available for the next production season. 

The solution to these problems appeared to be the development 
of a versatile group of girls who might be trained to perform both 
stitching and rubber-footwear-making operations. For a number 
of years prior to the depression in 1930 some success had been 
achieved in transferring certain hand-assembly operators from 
the stitching department to similar operations in winter-footwear 
departments, and in transferring stitchers to fill other types of 
stitching jobs that existed elsewhere in the plant. One of the 
difficulties encountered, however, was the possible failure of the 

1 Shoes with slight imperfections of style, not affecting their wearing quality, 
and sold at a discount. 



two seasonal lines to offset each other, as illustrated on Chart I 
(e.g., 1927). 

Winter-footwear production would frequently start before a 
sufficient number of girls were available from stitching. The pro- 
duction department was in doubt as to the possibility of leveling 
total production volume and balancing seasonal styles against 
each other. They objected that they would be unable to meet 
customers' delivery dates without sudden fluctuations of produc- 
tion or extension of usual seasonal limits. Furthermore, they 
argued that the weather played so important a part in determining 

1927 1928 1929 

Chart I. — New Process Rubber Company, Inc., Production of summer and winter 

footwear (in terms of pairs of shoes), 1927-1929. 

production volume that a severe winter or a very open winter or 
an early spring, would completely upset any attempt to maintain 
evenly balanced production. 

Nevertheless, management decided to attempt production 
stabilization whereby decreases in volume of winter footwear 
might be balanced by increases of summer footwear. This 
program was instituted in 1934, with a resultant improvement in 
transfer or exchange of employees between operations of a similar 
nature. For instance, canvas shoemakers were also used to make 
winter or gaiter shoes; lasters on canvas shoes were transferred 
to lasting operations on rubber footwear. Such transfers called 
for a change in the method of handling different materials. 


Lasting on canvas shoes involved handling a stiff and fairly 
rigid material that required a certain amount of pulling and 
stretching. Rubber material, on the other hand, was so flexible 
and delicate that any pulling stretched it out of shape. In 
changing from job to job, shoemakers had to show great adaptabil- 
ity. Sometimes the work with rubber material called for more 
delicate handling; at other times, the operations in canvas shoe- 
making required greater care. For example, a cementer of gum 
footwear merely swabbed the entire shoe with a bath of cement. 
With canvas shoes, however, cementing was a delicate operation 
requiring a steady hand in controlling the brush. The flow of 
cement had to be guided in an even line or else the shoe was 

Though rated as semiskilled workers, shoemakers showed 
themselves exceedingly adaptable, and their transfer from one 
making department to another proved a great success. But this 
plan failed to take care of the large majority of stitchers whose 
trade was dissimilar to other available occupations. Stitching 
rated as a skilled trade where the acquired skill consisted in 
ability to control the feed of power stitching machines that were 
driven by large motors at high speed; a more difficult task than 
the operation of a low-powered electric sewing machine in the 
home. There were different machines for different operations, 
some machines had two or more needles instead of one. Stitchers, 
therefore, were not only skilled workers but specialists who in 
time had become proficient in one or more of various stitching 
operations such as: single or double needle eye-stay stitching, 
turn-in or cord vamping, quarter binding, counter stitching, 
binding and closing; in all, 35 different occupations. 

Despite the dissimilarity in occupations, management decided 
in April, 1935, to experiment with the transfer of stitchers to 
shoemaking departments on hand-assembly conveyor operations. 
This attempt immediately aroused objections from both the 
employees and the plant supervisors and temporarily had to be 

Stitchers objected to the idea of changing their regular occupa- 
tion. Their prestige was injured when they were moved from a 
job where they sat down to control a power machine to another 
job where they stood in front of a conveyor to perform some 
manual operation. They had a highly developed sense of job 


proprietorship and were quick to identify themselves with certain 
machines. It was not unusual, for instance, for a former employee 
who started to work in a new season to request that she be placed 
at "her machine." It also happened that in case of machine 
failure, a stitcher, instead of transferring her work to another 
machine, preferred to wait while a maintenance man made neces- 
sary adjustments to "her machine. " The following reaction was 
typical of many highly skilled stitchers during management's 
first attempt to effect a transfer from the stitching to the rubber 
footwear making department : 

On Apr. 1 6, 1935, the employment manager approached Mary 
Valente, a highly skilled side-stay stitcher, on the subject of 

Randall: As you know, Mary, our stitching work is commencing to 
fall off. We're anxious, however, to keep as many girls as possible. 
One way to do this is to transfer as many girls as possible to other 
work during the dull season on stitching. I know that you have 
the ability to learn other work. . . . 

Mary: But surely, Mr. Randall, you're not going to transfer me? 

Randall: Why not? 

Mary: Why pick on me? I'm not on the layoff list, and according to 
my standing the ticket will have to go pretty low before I'm laid 
off. I'm a side-stay stitcher, and I know there's going to be 
plenty of my work for a while yet. 

Randall: That's true enough, Mary, but if we can transfer you to 
another job that'll mean one less girl we'll have to lay off from 
the stitching department when the ticket drops. 

Mary: You mean you'd transfer me and then put another girl on my 
machine? I don't call that fair. As long as my job is still here 
and my work is O.K., I don't see why you should give my job 
to somebody else whose qualifications are not as good as mine. 

Randall: Here's the point, Mary. The idea in trying to transfer you 
now is to protect your employment throughout the year. The 
girls who remain in the stitching department will stand in greater 
danger of layoff as production continues to drop. And if you 
know more than one job, you will be even more valuable to the 

Mary: I think I'd rather take my chances of a layoff. I can get a job 
in the necktie factory for the summer and then come back here 
when my job starts up in the fall. 

Randall: That's possible, Mary. But we shan't rehire as many girls 
next fall if our transfer program works out. You see, the girls 
we transfer to other jobs will be available to return to stitching 
work in the fall and that's why the volume of hiring will be reduced. 


Mary: Well, I don't think it will work, Mr. Randall. Of course, I 
don't like to see any of the girls laid off, but I don't see why I 
should take a shoemaking job that pays less money just to protect 
the employment of some of the other girls in this department. 
I'm a stitcher and I'm going to stay a stitcher even if I get laid off. 

As indicated in Miss Valente's final statement, another 
obstacle to the transfer of stitchers was the fact that the basic 
wage rate on stitching operations was higher than that on any 
other job available by transfer. 

Stitching supervisors sympathized with the attitude of the 
stitchers and were skeptical regarding the success of such trans- 
fers. They disliked releasing their most efficient girls for this 
experiment, since it was always necessary for production reasons 
to retain a nucleus of highly skilled girls. As production dropped 
in the stitching department, short-quantity orders for many differ- 
ences in style became more frequent and required an extremely 
versatile stitching force. 

Supervisors in shoemaking departments also were somewhat 
skeptical but were willing to make the experiment because of the 
notable success in intradepartmental transfers where shoemakers 
had been shifted back and forth between different types of shoe- 
making operations. Conveyor operators had easily adapted 
themselves to a variety of assembly jobs whenever different styles 
of footwear dictated that an operator should change from joining 
a back seam to applying a zipper or placing a gum binding, or 
some other operation involving the use of different materials and 
different methods. 

In 1936, the first attempt was made to transfer stitchers to 
shoemaking jobs. There were many disappointing failures. 
These were partly due to a lack of confidence on the part of the 
girls themselves, because of the objections previously stated, and 
partly to the fact that the girls selected for the experiment were 
not as versatile as some who might have been transferred had 
stitching supervision been willing to release them. The number of 
failures was further increased because shoemaking supervision 
lacked the patience to retrain stitchers who progressed more 
slowly than other transferred girls with previous shoemaking 

In a transfer program where stitchers were being taught to 
make shoes, it was equally essential to teach shoemakers to stitch. 


The supervisors of the stitching department resisted this part of 
the program. They could not see why they should retrain shoe- 
makers when experienced stitchers could be hired from outside. 
They argued that it cost less to hire experienced stitchers, and 
that previous experience with power stitching machines was vital. 
The following was a typical reaction from a stitching supervisor 
who subsequently became one of the most enthusiastic advocates 
of the transfer system: 

The employment manager went to Mr. Samson, superintend- 
ent of the stitching department, to arrange a program of transfers. 

Randall: Sam, how many shoemakers do you believe you could take 
into your department this season and train on stitching jobs? 

Samson: What do you mean, inexperienced girls? 

Randall: Well, they're skilled shoemakers, but, of course, they never 
stitched before. 

Samson: Why, man alive! I can't do that. D'you realize my produc- 
tion jumps from 5,000 pairs to 50,000 pairs in less than three 
months? Where would I get off at trying to teach shoemakers to 
stitch? I'd need extra machines, and floor space and instructors 
and extra training time. Think of the expense. I got hell for 
my training costs last year, and my girls were all experienced 
stitchers. You don't think I'm going to make that cost look any 
worse, do you? 

Randall: I'm not asking you to take all inexperienced girls, Sam. 
My idea is to work into this stabilization program gradually. 
If we train a few girls each year we'll eventually reach a point 
when the girls will be interchangeable each season. It will cost 
something at first, that's true, but if we retain a good percentage 
of the girls we train we won't have to repeat the training expense 
another year. 

Samson: It's a swell theory, Randall, but I've got to be practical. 
We can't teach gum shoemakers to stitch, I'd rather take green 

Randall: What's the advantage in that? 

Samson: Well, you know as well as I do that shoemakers just slap 
things together and do all their work with their hands. When a 
thing doesn't fit they just give it a pull and yank it together. 
It won't do to have any of this yanking and pulling in my depart- 
ment. Stitching is delicate work and has to be just so. It's 
ten times easier to train a green girl whose work habits haven't 
yet been formed. 

Randall: Do you realize that a large percent of our shoemakers are 
high-school graduates? Do you realize that many of them have 
already learned to perform from 10 to 15 shoemaking operations? 
We'll give you some of the most versatile girls we have. Try a 


few as an experiment, Sam, and that will prove whether or not it 
will work. 

Samson: You're not trying to tell me that Harry Murdock (super- 
intendent, shoemaking department) is going to transfer some of his 
best girls out of the department? 

Randall: Sure he will. He's most enthusiastic about the transfer 
program because he has demonstrated in his own department what 
can be done to develop versatility. He'll be willing to release 
some of his best workers not only to help you but to protect their 
employment and be sure of them next year. 

Samson: All right . . . But let me tell you, Randall, when my boss 
tells me to take shoemakers, I'll take shoemakers, but until then, 
I'll take stitchers. 

Another difficulty in the transfer of shoemakers to the stitching 
department was the temporary sacrifice of earning capacity during 
the period of retraining. Management was faced with the follow- 
ing paradox: some versatile girls in the shoemaking department 
were selected for transfer to the stitching department on the 
theory that they were considered most valuable to the company. 
In accepting this transfer these girls suffered a temporary loss in 
earning capacity, while girls who remained in the shoemaking 
department suffered no such loss. 

Management remedied this condition by setting up a schedule 
of transfer pay guarantees to be active during the established 
training period on all jobs. This meant that every employee 
would have her earnings protected during any retraining period 
that was occasioned by transfer. 

Shoemakers who had been transferred to stitching adapted 
themselves to the machine operations fully as quickly as many of 
the " experienced stitchers" who had been newly hired and who 
required a certain time to become acclimated to the plant and new 
working conditions. This practical demonstration convinced the 
supervisor of the stitching department that such retraining was 
feasible, and he no longer objected to the plan. 

The other objections to the stabilization program were grad- 
ually overcome also. Stitchers began to appreciate the value of 
security of employment in terms of increased annual earnings. 
Furthermore, they even discovered that during the winter- 
footwear season their weekly earnings increased. They found 
that in the shoemaking department work was laid out in mechan- 
ized conveyor units, which permitted an unrestricted flow of work 
throughout an eight-hour day and a five-day week. In their 


former stitching occupations (despite a higher base rate) the 
weekly earnings had frequently been less because of interruptions 
in the flow of work. One stitcher frequently had to wait while 
another stitcher completed her operation on a certain batch of 
work. Aside from such idle time in the course of a working day, 
there had been many days when the stitchers worked only six or 
seven hours because of the difficulty in scheduling the enormous 
number of individual stitching assignments. To make certain 
that the finished uppers were available, the production department 
generally allowed a safety margin in scheduling the work. 





§■ Boot and shoe 

I I New Process 
Rubber Company 


25.37% 67.4% 23.97% 26.5% 23.34% 3.1% 

1934 1935 1936 

Chart II. — Labor turnover comparison between the New Process Rubber Company, 
Inc., and the boot and shoe industry, 1934-1936. 

Figures for the boot and shoe industry taken from the Monthly Labor Review of the Board of 
Labor Statistics, United States Department of Labor, July, 1937, p. 162. 

The following reaction was typical of many stitchers who had 
spent one season as successful shoemakers: 

At the beginning of the stitching season in 1937, the employ- 
ment manager approached Rita Anderson with the object of 
arranging a transfer back to the stitching department. 

Randall: Well, Rita, we're nearing the end of the shoe season. How'd 

you like to go back to your old stitching job? 
Rita: Well, I don't know, Mr. Randall. This has been a good job. 

I've earned more money on this job than I ever did on stitching. 
Randall: You have? Isn't your rate on this job lower than on 




Rita: Sure, it's a little lower, but you see, I don't lose time on this 
job. The conveyor has a full schedule of work every day, and I 
almost never have to wait, and I never go home early. So that's 
how I've earned more money. As far as stitching goes, I'll be 
glad to go back there if they'll give me a full ticket. 

Reactions from other employees were as follows: 

Randall: Well, Jennie, it's getting time to transfer again. What d'you 

say on a trip back to canvas shoes? 
Jennie: O.K., Mr. Randall, but d'you know, I was just thinking that 

I'd like to learn a new job, one that I've never done before such 

as stitching eyestays or binding quarters. I'd like to learn all 

I can. Could you fix it up for me? 

Another girl did not wait for the employment manager to 
propose a transfer but appeared in the office of her own volition : 


1934 1935 1936 1937 

Chart III. — Stitching department labor trend, 1934-1937. Employees hired and 
transferred in New Process Rubber Company, Inc. 

' 'I hear the ticket is going down on gaiters, Mr. Randall. When 
are you going to transfer me? I'm ready to go whenever you say 
the word, and the sooner the better, because I don't want to get 
caught in a layoff." 



Chart II shows a comparison of the New Process Rubber 
Company's labor turnover figures with those of the boot and shoe 
industry as reported by the U.S. Bureau of Labor Statistics. The 
reduction in layoff percentage in 1936 to 3.1 per cent indicates a 
successful program of production scheduling and transfers. 

Charts III and IV indicate the marked improvement in trans- 
fers to and from the stitching department. 

58 78.2 


Per cent employees . 
laid off 

I Percent employees \ \ 
ii transferred out J J 



/ • 






1934 1935 I93G 1937 

Chart IV. — Stitching department labor trend, 1934-1937. Employees laid off and 
transferred out, New Process Rubber Company, Inc. 

In spite of the growing success of employment stabilization, 
two new problems arose in the mind of management. Turnover 
was so low as to threaten a condition of stagnation. Elimination 
of seasonal layoff made it difficult to remove the less capable 
employees from the company's employ, as had been the custom 
in the past. The least efficient employees, who nevertheless 
did not merit discharge, were the ones who ordinarily would be 
removed by a layoff. It was feared that these marginal employees 
whose jobs were now protected would become growing liabilities 


over a period of years. In time, their length of service would 
protect them even though they failed to satisfy minimum company 

Another problem arose because of the conflict between employ- 
ment stabilization and a method for evaluating employees, which 
was part of the regular employment procedure. It had been 
agreed that in the event of decreased departmental production, 
where no transfers were available, layoff should be made in accord- 
ance with employee status so determined. It happened in 1937 
that production in stitching and canvas-footwear-making depart- 
ments had dropped to a point that was considered minimum 
production. These departments had, therefore, merely retained 
a nucleus of capable employees to handle the wide variety of 
styles still listed despite the small total volume. Unfortunately, 
sales orders did not hold up as forecast, and the minimum had 
to be dropped to a lower level. Therefore, in each department, 
the number of employees had to be decreased. The employees 
with the lowest standing in their respective groups suffered a lay- 
off. This occurred despite the fact that lower ranking employees 
had previously been transferred to other departments and had 
thereby been protected in their employment. 

Case 15. The Rinehard-Coughlin Case 

(Transfers into a department following increase of department activity. Transfer 



Mr. Rinehard, supervisor of Department A. 
Mr. Coughlin, supervisor of Department W. 
Mr. Randall, employment manager. 

In hiring and transferring employees, the employment manager 
at the New Process Rubber Company came in contact with many 
different types of foremen. At one time he was confronted 
with the following extremes: Mr. Rinehard was the supervisor 
of Department A, which was small and one in which style and 
seasonal changes occurred with comparative infrequency. The 
need for a scheduled program and production planning had, 
therefore, not been great. Operators worked on but one simple 
job throughout the season and had little opportunity to demon- 
strate adaptability or to acquire versatility. As a result they 
lacked the capacity to adjust to such changes as did occur within 
the department. This restricted the effectiveness of the depart- 
ment in meeting different production requirements. 

Department W, in contrast to A, was a large department that 
was scattered about in several buildings and on different floors. 
The department was engaged in preparatory fitting or assembly 
of footwear parts for delivery to another department where final 
assembly or actual shoemaking took place. Partly because of 
inherent qualities, and partly because of the circumstances under 
which he was forced to work, Mr. Coughlin, the supervisor of 
Department W, had attained a constructive viewpoint on the 
matter of both hiring and transfers. He cooperated in every way 
to make the program of employment stabilization a success. 

On June 10, 1937, David Rinehard came to see Mr. Randall 
with an employment requisition. He wanted two girls, one to be 
employed on a job stitching fleece linings; the other to work as a 
hand cementer applying rubber cement to the margin of linings. 
The following conversation took place : 



Rinehard: I've got to fill these two jobs tomorrow morning and I wish 
you'd hire Sally DeVecchi for the stitching job and Caterina 
DiMaggio for cementing. They worked for me before. 

Randall: I remember those two girls, Dave. Sally DeVecchi was 
transferred from your department to the stitching department and 
we laid her off when the ticket dropped in February. She didn't 
make out so well in the stitching department. Her work was 
rather poor and she was among the first to be laid off. 

Rinehard: Well, I'll admit she's not a world-beater, but she knows this 
particular job and could start right in without any training 
expense. I've got to have production on that job right away, and 
an inexperienced girl would take time to learn. 

Randall: Suppose I transfer an experienced stitcher, Dave? 

Rinehard: She wouldn't do me any good because she wouldn't know 
this particular job. She wouldn't be any good to me for at least a 
week and in the meantime I'd have to take off a regular girl for 
instruction and if I don't deliver to the making department 
there'll be hell to pay. 

Randall: Couldn't you have anticipated this change? 

Rinehard: Hell, no. I didn't know a thing about it until this morning. 
They changed the listings on one of the making conveyors to meet 
a rush order. It doesn't affect the making department at all, 
because their operations are practically identical, but it makes my 
operations entirely different. I don't see why you should object 
to hiring this girl if I'm satisfied? 

Randall: Well, here's the point, Dave. The stitching ticket is very 
low right now and we have a surplus of good stitchers. If we don't 
find work for them we'll just have to lay them off. They're 
capable girls who have a lot of experience on a variety of jobs. 
It doesn't seem good business to drop good girls like these and at 
the same time rehire a girl like Sally whose ability is very definitely 
limited. Why don't you let me give you two stitchers. They'll 
get your production out, and you can send either of them back to 
me as soon as the other is capable of handling the work alone. 

Rinehard : Why go to all that expense when I can get one girl to do the 
work? Besides, I've only got one machine. ... I think we'll 
have to take Sally. I have a friend of hers working for me who 
lives on the same street. She could notify her tonight. That'll 
make it a lot easier for both you and me. 

Randall: I think we can do better than that, Dave. D'you remember 
Mary Conly who used to case stock for you down in A-18? 

Rinehard: Yes. She's a good girl. But she never stitched linings, 
did she? 

Randall: I think she did once at the United Rubber Company. 
She's working for John Coughlin now on machine cementing over 
in W-26. If John could release her. . . . 

Rinehard: Fat chance! John is loaded to the gills right now. That 
would put him in a hole, and besides, you'd still have your surplus 
stitchers to place. 


Randall: No, I'd get John to take one of Sam's stitchers to replace 

Mary. Let me give him a ring. 

(Calls foreman Coughlin on the phone.) Hello, John? Say, 

Dave Rinehard's in a hole. Could you let him have Mary Conly 

if we replace her with one of Sam's stitchers? 
Coughlin: (Over the phone.) Absolutely no. Mary's my only 

raceway girl now because Nellie's out sick. I'll tell you what I can 

do, though. You can have Jennie Liccardi. She stitched linings 

all last season. She's good, too. And she's a crackerjack at hand 

Randall: What's her point hour? 
Coughlin: She's a 90 to 100 point operator. I'll tell you what. Let 

me have that little blonde kid that's working for Sam on toe-caps 

and Dave can have Jennie. 
Randall: O.K. Hold the line just a minute. 

(To Rinehard.) What d'you say, Dave? You can have Jennie 

Liccardi. She's an experienced lining stitcher, and she does 90 on 

hand cementing. You can use her on both jobs. 
Rinehard: Well, if she's as good as all that, I might get by without 

hiring a hand cementer. 
Randall: Give it a try, Dave. I'm sure Jennie won't let you down. 
Rinehard: O.K. 
Randall: (Over the phone to Coughlin.) Hello, John? All right. 

Send Jennie over when she finishes today and I'll get Greta Hanson 

for you. Thanks a lot. 

(To Rinehard.) Jennie'll be there first thing tomorrow morning. 

I'll change your requisition to one girl. 
Rinehard: Fine . . . only, couldn't we do something for Sally 

DeVecchi and Caterina DiMaggio? They're really nice kids, 

and I sorta promised them a job. 

Case 16. The Kelly-Flanagan Case 

(Production transfer following a decrease of departmental activity. Transfer out.) 

When there was a decrease of production in any particular 
department, the foreman listed his surplus labor force as a pre- 
liminary step to layoff. If he found, for example, that he could 
dispense with the services of 10 men, he would select the 10 
employees with the lowest standing in the department and send 
their names to the employment department. This served as a 
warning that unless other steps were taken, these 10 men would 
receive the stipulated one week layoff notice. The employment 
manager then consulted the foreman to determine whether there 
were any employees in the department who were qualified for 
transfer. Transfer was used in this way to protect the employ- 
ment of able workers. Versatile employees might be transferred 
to other departments and so be assured of permanent employ- 
ment. Incidentally, this policy tended to protect all workers, 
since every transfer out of the department reduced the number of 
names on the layoff list. If, after all possible transfers had been 
made, there still remained a surplus of workers, they would have 
to be dropped. 

There was one technical exception to this procedure. It had 
happened that workers objected to being transferred on the 
ground that their job security was being endangered. They 
said in effect, we are being transferred to a new department and a 
new job where lack of experience makes it difficult for us to estab- 
lish ourselves, since in the event of a layoff in the new department 
we are being compared with workers who have more experience. 
As a result we find ourselves on the layoff list. To remedy this 
situation, management made the following ruling: "In the event 
that an employee has a relatively low status due to departmental 
service of less than three months, his standing in his previous 
department, recorded at the time of his last transfer may be 
considered to establish his employment standing in the former 

If it was found that any person scheduled for a layoff had been 
in the department less than three months, he was privileged to 



return to his former department and resume his former standing. 
If his former status in this department was higher than that of 
others, he established his right to work in his previous job, thereby 
displacing a person of lower standing. This technical exception 
enabled management to protect the employment of the best 
qualified workers and operated as follows : 

Mr. Kelly was employed in the packing department. On 
Sept. 3, 1937, Jones in this department was scheduled for layoff. 
Kelly, being more versatile, was selected for transfer to the winter 
footwear-assembly department, which needed additional workers, 
thereby enabling Jones to retain his job. For two months, Kelly 
worked in his new job as an outsole pressman. In November 
there was a sudden decrease in activity, necessitating a general 
reduction of labor force in the winter-footwear department. 
According to the layoff procedure, Kelly was among those with a 
low standing and would ordinarily be placed on the layoff list. 
But since Kelly had been in the department for only two months, 
he was allowed to return to the packing department, where he 
resumed his former status. The packing department, still being 
unable to absorb any more employees, then dropped Jones, who 
had previously been slated for layoff, management having done 
all it could to protect his employment. 

The three-month limit in this procedure became an important 
factor as is illustrated by the following example : 

The Example of Joseph Flanagan 

In September, 1936, management instituted a drive to transfer 
men out of "boys'" jobs. 1 This affected Joseph Flanagan who 
was 23 years of age and had been employed for five years in the 
molding department as a light mallet and die stamper, cutting 
out ankle patches for canvas shoes. Flanagan was transferred 
to the cutting department as a heavy stamper, which was classified 
as a man's job. He worked in this department for 14 months. 

1 The New Process Rubber Company had certain jobs that were extremely 
unskilled but not considered tit for girls because of working conditions (lifting heavy 
materials, etc.). The work was simple and rated low pay. For this reason, young 
men without any previous experience or particular qualifications were hired. These 
jobs were known as "boys'" jobs even though the company did not employ anyone 
under eighteen years of age. During the depression there had been no opportunity 
for promotion, and many of the young men doing "boys'" work had come of age 
and been married. Despite this fact, any employee doing this kind of work was 
considered a "boy." Management decided to transfer men out of "boys'" jobs 
to give them an opportunity to do higher paid work. 


Despite the fact that he did satisfactory work, he had the lowest 
standing in the department. Therefore, in November, 1937, when 
departmental activity dropped, Flanagan's name was put on the 
layoff list. Flanagan appealed to Hennessy, his representative, to 
petition the employment department that he should be returned 
to his old job. He argued that his employment should be pro- 
tected, since if he had stayed on the old job he would not have been 
on the layoff list. Furthermore, he had recently married and 
needed the work. 

The representative, James Hennessy, called upon the industrial 
relations manager, who made an appointment for him to see the 
employment manager on the following day. Meanwhile the 
employment manager investigated the situation, going through 
Flanagan's past history and interviewing the foreman of his 
previous department. The foreman was sympathetic to the idea 
of transferring Flanagan back to his department, despite the fact 
that Flanagan had been in the new department for 14 months 
and that his former job no longer existed on account of a change in 
manufacturing process. The employment manager, however, 
stressed the importance of adhering to company policy and 
decided against such a transfer. 

The next morning, Representative Hennessy came to see the 
employment manager. 


Mr. Hennessy, union representative. 

Mr. O'Reilly, foreman of the molding department. 

Mr. Randall, employment manager. 

Hennessy: Did you know that Flanagan is scheduled to be laid off? 

Randall: Yes, I have his name on the cutting department layoff list. 

Hennessy: Aren't you going to transfer the poor boy back to the 
molding department? 

Randall: I'm sorry, James, but we can't do that for several reasons. 
In the first place, he has been in the cutting department for 
14 months, which is ample time to enable him to establish a fair 
status. As you know, it is only in cases of less than three months 
that we consider the reinstatement of a man in his former depart- 
ment. During the period since Flanagan has been transferred 
we've had more than 2,000 people transferred between depart- 
ments. It's obviously impossible to put this number of transfers 
in reverse, and yet, if Flanagan were to be considered for such a 
transfer, there's no reason why every one of these transfers should 


not also be reviewed for the same purpose. In addition to this, the 
job on which Flanagan was previously employed no longer exists. 
We don't stamp ankle patches any more. They are now molded on 
the uppers in the stitching department. Furthermore, the molding 
department has suffered the heaviest layoff of any department in 
the plant the last few weeks despite the fact that we have reduced 
them to a three-day schedule in order to spread the work. 

Hennessy: I still think that Flanagan would have a better standing 
than any of the boys still in the molding department and should be 
allowed to go back. It wasn't fair in the first place to put the boy 
into a department with a bunch of long-service men where he 
doesn't stand any show in making a place for himself. He's 
married now and deserves a job of some sort in the molding depart- 
ment much more than some of the kids who are still working there. 

Randall : Well, James, we've got to keep in mind that Flanagan is only 
one of a number of men that are being laid off in the cutting 
department. If we should make such a transfer they could right- 
fully feel that they should receive similar consideration which 
I know, and you know, is definitely impossible. I feel, therefore, 
that we're taking the only wise stand by adhering strictly to our 
policy. I'm sorry, but we simply cannot transfer Flanagan. 

Hennessy: All right, if that's the answer. I'm not satisfied with it, but 
I'll tell Flanagan that I've done all I could for him. 

After Flanagan had been told by Hennessy that he could not 
be transferred, Flanagan, on his own initiative, interviewed the 
foreman of the molding department. He managed to give the 
foreman the impression that he had been authorized to see him 
regarding a possible transfer and so was promised a job cementing 
small parts at a low rate of pay. 

The next morning, Patrick O'Reilly, the foreman of the mold- 
ing department called on the employment manager to inform him 
of the transfer arrangement. 

O'Reilly: I'm sorry, Randall, but the only job I could give Flanagan 
was that of cementing insoles. It doesn't pay very much but is 
better than nothing, and as long as he's satisfied I told him he 
could start in next Monday morning. 

Randall: Just a minute, Pat, what are you talking about? Didn't I 
tell you definitely, day before yesterday, that Flanagan would not 
be transferred? 

O'Reilly: Well, that's what I thought you said, but when Flanagan 
came down to see me I supposed you must've sent him. I tried to 
get you on the phone but you were out and one of your girls 
answered. I asked her what she knew about Flanagan's transfer, 
and she said she would look through the transfer cards on your 
desk. Then she came back and said that Flanagan's transfer card 


had not come through yet. So I took it for granted that the 

transfer was O.K. 
Randall: It most decidedly is not O.K., Pat, and I'll have to fix this 

right away. You'd stir up a fine mess in your place by bringing 

in a man after all the people you dropped in the past week. 
O'Reilly: Well, I'll admit it doesn't look so good. 
Randall: Well, you forget about it, and I'll fix it up. 

The employment manager then went to the cutting department 
and found that the atmosphere in this place was tense. He 
explained the situation to the foreman who was much relieved 
and said: "You know, Randall, I couldn't understand what was 
happening around here when I came in this morning. Half the 
men were sore at each other and weren't on speaking terms. 
Jackman, one of the workers on the layoff list, walked over to the 
representative and gave him the 'razzberry,' practically spitting 
into his face. I see now that the men were only sore because they 
thought that Flanagan had been given preference while the others 
were going out." 

Flanagan was called into the foreman's office and told that 
the transfer had not been authorized and could not be effected. 
Mr. Randall then talked to Representative Hennessy and explained 
the situation to him. Hennessy was tremendously relieved 
because he had been besieged all morning by dissatisfied employ- 
ees on the layoff list who wanted to know why they couldn't be 
transferred also. He stated that Flanagan had actually thumbed 
his nose at him on coming to work that morning, saying: 
"You're a hell-of-a-representative. You claim you had been to 
headquarters for me and that I couldn't be transferred. Well, 
let me inform you, M r. Representative, I'm to be transferred back 
to my old department next Monday morning. What d'you 
think o'that?" Hennessy went on to say: "Much as I hated to 
accept your decision, Mr. Randall, I did accept it feeling that I 
had received it from an authoritative source. I'm certainly glad 
now that the transfer's not going through, because it would 
make me look a terrible piker." 


Case 17. Tentative Procedure of Employee Evaluation 
at the New Process Rubber Company, Inc. 

The last decade has seen a steady increase in the practice of 
making periodic appraisals of individual employees, their progress, 
and value to the company. By means of a systematic rating 
procedure, management has tried to obtain a better knowledge 
of their employees and to devise a tool that should provide 
factual information to be used in arranging transfers, promotions, 
and layoffs. 

During the early months of 1937, the management of the New 
Process Rubber Company considered the introduction of an 
employee rating system and on Mar. 12, 1937, instructed the 
employment manager to study readily accessible procedures and, 
with this experience as a guide, to draw up a tentative system. In 
accordance with this assignment, the employment manager con- 
ducted an explorative survey of rating procedures in 10 companies 1 
and secured the following information. Not one of the 10 com- 
panies studied was entirely satisfied with the techniques that had 
been developed and the results that were obtained. Some of 
them, in fact, were greatly disappointed and nearly ready to 
conclude that employee rating systems created more problems 
than acceptable results. 

There were two major procedures in employee evaluation: 
either (1) all employees in one department who were engaged in 
similar work were compared with each other, or (2) each employee 
was considered separately and rated against an ideal. In some 
cases both methods were used by different raters in the same 

The customary procedure in the first instance was as follows: 
The rater (usually the foreman) laid out the rating sheets for all 
operators on similar jobs. He then selected the employees having 

1 We are not at liberty to present sample rating sheets and forms of personal 
analysis, since the companies studied were still experimenting with these schemes 
and did not wish to be identified. 



the highest and lowest value as regards any particular factor. 
The other members of the group were then graded in between 
these two extremes. 

In the second case, the rater considered all factors in sequence 
with reference to any particular employee and rated this indi- 
vidual against an ideal conception of any trait in question. 

This difference in rating procedure led to many complications. 
Depending on what procedure was adopted, foremen differed in 
their conception of what was meant by " highest " and " lowest." 
Assuming that a trait was rated in a scale of 10, the foreman 
rating against an ideal seldom used the ratings 10 or o; while 
another foreman who rated a group of employees on a comparative 
basis habitually gave the rating 10 to the "best" man in the 
group, regardless of ideal qualifications. There were no objec- 
tions to this interdepartmental diversity of practice when ratings 
were only used for comparison within the group. But, when 
each man's rating was recorded as a part of his employment 
record, and when this record was used for layoff considerations, 
promotion, or transfer, definite harm was done. For it meant 
that an employee's rating in various departments would measure 
his general value to the company and compare him with every 
other employee in the plant. Consequently, in fairness to the 
employee it was essential that a uniform objective rating pro- 
cedure be used throughout the plant. An employee was consider- 
ably puzzled and disturbed, for example, when in one department 
a foreman rating on a comparative basis gave him a score of 90, 
while, upon transfer to another department, the new foreman, who 
compared the employee with a new group or rated against an 
ideal, merely gave him a score of 70. 

In general it was found that foremen who rated on a compara- 
tive basis were more lenient in their evaluations than foremen 
who rated against an ideal. The latter, especially if they had 
many employees, frequently argued that any given scale offered 
them insufficient range to make accurate differentiations. To 
remedy this they adopted the practice of interpolating grades, 
for example, allowing one or two extra steps between "fair" 
and "good." This procedure led to a more rigid analysis of 

A similar problem arose when an employee had worked in 
different sections of one department and it was necessary to 


establish a rating that required the judgment of two or more 
raters. The common practice was to bring the various raters 
together, discuss each case, and then arrive at a common agree- 
ment. In some instances, however, each foreman rated inde- 
pendently, and the supervisor then averaged the results. The 
latter procedure often resulted in rating values that were expressed 
in decimals, thereby multiplying the classifications under any 
particular factor ten times. 

In the 10 companies studied, it was management practice to 
issue copies of all systems, such as employee rating for instance, to 
division superintendents and department heads. This meant that 
section foremen and their assistants who did the actual rating 
were not included in the distribution. It was expected that each 
supervisor, in case of need, would consult the copies on file in the 
office of his department head. In practice, however, most of 
this information was passed down the line verbally. This led to 
misunderstandings of rating and layoff procedure. 

For example, section foremen and their assistants were sup- 
plied with copies of the rating sheet. Brief instructions for the 
use of these sheets were generally printed on the back of each 
sheet. It happened, however, that in some instances these instruc- 
tions needed to be supplemented by information contained in the 
detailed system on employee rating. The following case gives an 
example : 

The Example of Miss Lombardi 

Miss Lombardi had been transferred from the rotor depart- 
ment to core assembly. She was employed there as a balancer 
for six weeks. On Nov. 12, 1936, her name was forwarded to the 
employment department on the layoff list. In view of her short 
department service, the employment manager arranged a transfer 
back to the rotor department. This action was protested by the 
foreman of the rotor department on the ground that he had no 
work for her to do. The employment manager pointed out that 
under the employee rating system, Miss Lombardi was entitled 
to such consideration. The foreman replied that he was not 
aware of such a ruling and insisted that the instructions as listed 
on the back of the rating sheet made no mention of such procedure. 
The employment manager then showed him the ruling as stated 
in Par. 10 of the system governing employee rating: 


"In the event that an employee rates low due to short depart- 
mental service of less than three months, his rating in his pre- 
vious department recorded at the time of his last transfer, may- 
be considered to establish his employment preference in the 
former department.' ' 

He explained that it was not surprising that the foreman had 
forgotten its existence, since to date there had been little occasion 
to apply this provision, because few layoffs had been necessary 
since the inception of the system. 

In all cases where employee rating was studied there were 
frequent differences of opinion regarding the interpretation of 
factors listed on the rating sheet. For instance, many foremen 
differed in their evaluation of employees with reference to " quality 
standards." Some foremen were of the opinion that " quality" 
referred only to quality of work, a result that was measured in 
terms of the product. Other foremen, however, adopted a 
broader definition of quality by looking not only at quality of 
work but also at quality of workmanship as measured by the 
employee's use, maintenance, and care of machines and tools. 

Particularly troublesome was the interpretation of personality 
factors such as " conduct," " cooperation," and "mental attitude," 
the rating of which required judgment and was supported by 
impressions and incidental observations rather than by routine 
records and regular factual information. In one case, "conduct" 
had been defined as an "employee's behavior and deportment." 
Many foremen were at a loss how to rate this factor and requested 
that they be provided with illustrative examples. A subcom- 
mittee appointed by the personnel manager finally furnished them 
with the questionnaire, shown on p. 103, which was to aid the 
foreman in grading his employees on conduct. 

Similar questionnaires were eventually provided for other 
personality factors. This markedly increased the paper work 
connected with each employee rating. 

Another difficulty concerned the appropriate weighting of 
factors on the rating sheet. Employees questioned supervision's 
judgment on intangible personality factors and were of the 
opinion that the assignment of different weights to various factors 
was wholly arbitrary and unfair. In view of such controversies 
it was generally agreed that rating sheets and procedures should 
be as simple as possible. 


All concerns using employee rating systems agreed that when- 
ever possible, factors on the rating sheet should be of such a 
nature that scoring could be done by referring to factual and 
routine records. It was important, however, to consider carefully 
what routine records could safely be utilized to supply information 
for rating purposes. One company, for instance, had adopted the 
practice of drawing upon " Reports of Minor Accidents" in 
rating their employees on general attitude. When this practice 
became known, employees feared that they might be penalized 
for reporting minor accidents and stopped making such reports. 
This reaction entirely negated the splendid results that had been 

Proposed Questionnaire 

Answer Points 

1. Is this person one who does not play pranks that might 

endanger other workers? Yes 1 

2. Does this person perform his work without being unnecessarily 

noisy? Yes 1 

3. Does this person refrain from using objectionable language on 

the job? Yes 1 

4. Is this person always willing to carry out instructions and 

requirements of job? Yes 1 

5. Is this person always willing to try new methods? Yes 1 

6. Does this person use a helpful attitude in notifying supervision 

regarding conditions that require attention? Yes , 1 

7. Does this person call to attention of supervision defective 

work received? Yes 1 

8. Is this person one who does not offer excuses or alibis to avoid 

accepting his proper responsibilities? Yes 1 

9. Does this person get along unusually well with other workers? Yes 1 
10. Regulations governing serious misconduct: 

Any serious violation of the rules of conduct involving intemperance, dishonesty, 
or other misconduct not covered by the above questions shall justify in addition to 
proper disciplinary action, penalty, or discharge, a deduction of five points from the 
employee's current rating on conduct. Such action, however, shall be taken only 
after review and approval by the Manager of Industrial Relations. 

obtained by the safety engineer in his campaign to prevent 
accidents and to establish statistical information with reference 
to the causes of minor accidents. 

It was also found important to consider carefully the time and 
circumstances under which employees were rated. For example, 
all companies were agreed that it was inadvisable to rate employees 
during the time of actual layoff. Ratings could be discussed most 
satisfactorily when no decision was impending. Furthermore, 
talks with employees concerning unsatisfactory service records 
were beneficial only when there was a possibility of effecting some 
adjustment. The following example illustrates this point: 


The Hogan Example 

Mr. Hogan's name had been put on the layoff list and he was 
given the customary one week's notice. He had been regarded 
as an exceedingly able employee and had recently been transferred 
in order to protect his employment. Owing to a decrease of pro- 
duction in the new department he was laid off. Mr. Hogan 
complained. His superintendent chose this time to have a heart- 
to-heart talk with him and analyze some of his deficiencies as indi- 
cated by the man's rating sheet. Mr. Hogan had never been 
criticized before and he seemed both startled and indignant. In 
view of his imminent layoff he felt that further employment oppor- 
tunities with the company in question were jeopardized, and he 
became so hysterical that medical attention was required. The 
personnel manager learned of his case and was able to reassure Mr. 
Hogan. At the first opportunity, Mr. Hogan was rehired and 
given an opportunity to demonstrate that he could successfully 
overcome certain aggressive personal characteristics. His 
subsequent record with the company was excellent. 

The employment manager, having completed his explorative 
survey, submitted the following plan to the vice-president for his 
consideration and approval. 


i. General Purpose. The purpose of this system is to establish a 
uniform procedure to determine equable service ratings for all clock-card 
employees, such service ratings to determine order of layoff within the 
department in the event of decreased production and preference in 
cases of promotion or transfer. 

The system is to provide management with a tool to measure an 
individual's value to the company and give employees an incentive to 
build up a merit rating. 

The rating scale offers management the possibility of offsetting a 
small service differential by exceptional merit on the part of individual 
employees. It protects workers who have attained long service and 
acts as a constant reminder to foremen that they have definite training 
and leadership responsibilities. As the difference in length of service 
increases, the scale tends to become inoperative. Therefore, manage- 
ment through its first-line representatives must make sure that cases of 
marginal 1 employees are detected early. 

1 Marginal employees are workers who are not inefficient enough to be discharged 
but who seem to be without sufficient positive qualities to recommend themselves 


2. Procedure, a. An employee rating sheet shall be recorded for 
each employee on the Factory Payroll. This employee rating sheet is 
to be filed in the department in which an employee works within three 
months following the entrance of the employee into the department. 
Rerating of all employees in a department should be made on a new 
sheet at least every six months. An effort will be made to establish 
these ratings at a time of maximum departmental employment and to 
avoid rating during a period of actual lay-off. New employees may be 
rated between regular rating periods. 

b. Comparison of Service Ratings shall be confined to employees 
engaged on similar work in the same department, and rated by the same 
foreman. In the event of lay-off caused by decreased production, 
employees having the lowest total credit points in the same department 
will be laid off. 

c. It is the policy of the company, whenever possible, to give employ- 
ees notice of lay-off one week before lay-off occurs. This means seven 
calendar days before the employee is paid off. It also means that 
during the seven calendar days after notice of lay-off an employee shall 
receive an amount of work equivalent to that currently scheduled for 
one week in the department where the lay-off occurs. 

d. Department supervision must provide the Employment Depart- 
ment with a list of any employees to be laid off, one week in advance of 
anticipated cancellation. 

e. In the event that an employee rates low due to short depart- 
mental service of less than three months, his rating in his previous 
department recorded at the time of his last transfer, may be considered 
to establish employment preference in the former department. 

/. If any act or performance of an employee warrants an alteration 
in his rating sheet, a correction may be made on the old sheet by adding 
the new values under the proper headings. (In such a case, old values 
may be crossed out but not erased.) Likewise, any change of status 
occurring between rating periods will be noted on the rating sheets as 
soon as brought to the attention of supervision. Supervision should 
notify an employee at the time any such change is made. 

g. No change will be made on any rating sheet without the knowl- 
edge of the person whose name appears on the front of the sheet, as the 
original rater, that is "Rated by " 

h. Copies of the employee rating sheet together with instructions 
covering its use, are posted in all departments and are available to all 

i. All employees are free to see and to question these Service 
Ratings at any time. 

j. Copies of the system concerning " Factory Payroll Employee 
Rating Sheet" shall be distributed to all first line representatives who 
do the actual rating. 

favorably to management. When production is high and workers are in demand, 
these employees tend to drift from one department to another, each foreman in turn 
"passing the buck" to someone else. 


k. Any questions regarding the use of the rating sheet or interpreta- 
tions pertaining thereto should be referred to the employment manager 
who acts as a central authority to standardize and co-ordinate the use of 
employee rating sheets throughout the plant. 

Employee Service Rating 

Name Dep't No 

Present Job Date 

Rated by 

Approved by 

The service rating measures each employee according to the length and value of his 
service. Each employee is to receive one credit point for each year of service and 
one additional credit point for each question that can be answered in the affirmative. 


i. Accumulated Service. (One point for each year) □ 

2. Attendance. Is the employee prompt and regular in attendance? □ 

3. Quantity of Work. Does this employee regularly maintain or exceed the 

standard production quota? □ 

4. Quality of Work. Does this employee's work meet quality standards with 

little or no spoiled work? □ 

5. Quality of Workmanship. Does this employee keep his work place, equip- 

ment, tools, and machines in good order and 

condition? Q 

6. Job Knowledge. Is this employee able to fill more than one major job in this 

plant? (From Job Classification Sheet.) □ 

7. Ability to Learn. Has this employee learned new work within the expected 

time? □ 

8. Adaptability. Can this employee readily adjust to radical changes in job 

requirements? □ 

9. Skill. Can this employee perform a highly skilled job with apparent ease 

and dexterity? □ 

10. Dependability. Is this employee thoroughly trustworthy and dependable 

in the absence of supervision? D 

12. Attitude. Does this employee express a helpful attitude in notifying super- 

vision regarding conditions that require attention? □ 

13. Cooperation. Is this employee always willing to carry out instructions and 

requirements of the job? □ 

14. Conduct. Does this employee refrain from using objectionable language on 

the job? □ 

15. Behavior. Is this employee one who does not play pranks that endanger or 

embarrass other workers? □ 



/. The Employment Department shall also audit rating sheet 
records as kept in different departments and notify any departments 
that fail to re-rate on their established rating dates. 

See Rating Sheet on p. 106 and instructions thereon. 

General Instructions 

The Service Rating Sheet is divided into four sections and should be filled out 
from beginning to end for each employee separately. 

1. Service. This rating is based on factual information that will be supplied by 
the Employment Department. 

2. Items 2-7. These factors are measured by data given on routine records 
such as: 

Attendance records 

Time slips and pay-roll sheets 

Inspection slips 

Maintenance expense accounts 

Job-classification sheet 

Training schedules and instructor's report 

3. Items 8-1 1. The scoring of these factors is to some extent dependent on the 
above factual records but involves individual observation and the exercise of judgment 
on the part of the supervisor. 

4. Personality Factors 12-15. These ratings are wholly a matter of judgment 
and the rater's impression of the employee in question. 

The factors on the Service Rating Sheet range from strictly objective and 
quantitative data to evaluation based on observation and judgment. As the rater 
proceeds from one extreme to the other he will find that individual factors are 
interrelated. Furthermore, the information already recorded in the upper brackets 
will help the rater in evaluating the subsequent factors. It is, therefore, essential 
that the items are rated in the sequence in which they occur. 

Case 18. The Case of Service Shoe Elaine 

(Difficulty of safeguarding the employment of a specially qualified employee.) 


Mr. Rhinelander, Supervisor of the service shoe department. 
Mr. Bookman, supervisor of the pay-roll department. 
Mr. Randall, employment manager. 

Miss Elaine Plevnow was employed as a clerk and comptom- 
eter operator in a factory department office. She had only one 
year's service but during this time had identified herself with the 
department, so much so that throughout the factory she was 
known as " Service Shoe Elaine." In clerical activities she was 
the point of contact with other factory offices and such main 
offices as standards, employment, pay roll, production scheduling, 
etc. Her nickname, "Service Shoe Elaine," was derived from 
her customary telephone greeting: "Good morning, Service Shoe." 

Within the service shoe department, Miss Plevnow had daily 
occasion to talk to every employee. She prepared the pre- 
liminary statement of each operator's output on which earnings 
were based and checked the records if there were complaints with 
regard to pay-roll credit. Her position required tact and an 
objective temperament. The supervisor of the department con- 
sidered that at least a year of training was essential to prepare a 
qualified employee for this kind of work. 

Service shoe production was customarily carried on in two 
separate sections, which were located in different parts of the 
building. Section A took the peak load of production and was 
closed down whenever production dropped below a certain 
minimum, the work then being consolidated in Section B. Early 
in November, 1937, this change had to be put into effect and 
required the closing of the office in Section A. Miss Plevnow's 
name was placed on the layoff list. Mr. Rhinelander, the super- 
visor of the service shoe department, appealed to the employment 
manager : 

Rhinelander: Look here, Gordon, I should think we ought to do some- 
thing for Service Shoe Elaine. Can't we find a job for her in the 



main office? It doesn't seem good business to let her go just when 
we've succeeded in training her for the job. That might have been 
all right in the old days when we had no employment department 
or industrial relations policy. But in the light of what we know 
now, it seems obvious to me that if we use our heads at all we're not 
going to drop such a good employee just because her present job 
has shut down. We're sure to need her again and if we lay her 
off now we might lose her for good. 

Randall: I agree absolutely, Dick, so far as the principle of your 
proposal is concerned. But the problem we're faced with is the 
question of displacing some one else to make room for her. 

Rhinelander: I can't see the logic in that. You know very well that 
we have many dime-a-dozen clerks employed on the simplest of 
clerical operations that hardly require any training at all. Many 
of these clerks have only been here a short time, too. Service 
Shoe Elaine is ten times more valuable to us than any one of these 
clerks. It seems almost an insult to Elaine to offer her such a job 
at all, but I suppose, she'll agree that temporarily it's better than 

Randall: Well, why don't we get Bookman down here and put the 
proposition up to him? 

Rhinelander: O.K., that's an idea. 

The employment manager called Bookman on the phone and 
was able to arrange an immediate meeting. When Bookman had 
seated himself, Randall, as the employment manager, took the 
initiative in stating the situation : 

Randall: Jack, Dick has just been telling me of one of his difficulties 
in the present layoff. He's closing one of the service shoe offices 
and hasn't any job for Service Shoe Elaine. 

Bookman: Tough luck. She's certainly the type for that kind of work. 

Randall: That's just it. We all realize she's a capable girl, and it 
seems a shame to drop her if we can find any way to protect her 
employment. You know her abilities from your contact with her. 
Why couldn't you take her on as a comptometer operator and drop 
one of your girls who is doing some simple job and has less service 
than Elaine? 

Bookman: That isn't as easy as you think. How am I going to justify 
displacing one of my girls when she knows very well that her job 
isn't affected by the service shoe drop? 

Randall: Well, we have to think of the company as a whole. Surely, 
it's bad business to spend a year training a girl like Service Shoe 
Elaine and just when she makes good drop her because we can't 
see our way clear to lay off a clerk who could be trained in a week. 

Bookman: It isn't only the girl. I have to think of the other clerks 
as well. You know very well they would be up in arms if the 
main office showed a preference to a factory girl. 


Rhinelander: You can hardly call Service Shoe Elaine a factory girl. 
She's a clerk as well as the others, and, besides, she gets on swell 
with the pay-roll girls. 

Bookman: That may be so, but wait till she " bumps" one of them. 

Randall: Oh, I'm sure it could be handled all right. After all, the 
company has quite a stake in this proposition. We just can't 
afford to let a well-trained girl like Elaine go. 

Bookman: But why pick on me? Why should I protect her employ- 
ment at the expense of my own department? I take a big chance 
upsetting my whole gang and all for what? Eventually Service 
Shoe Elaine will be returned to the factory at no cost to them and 
I'll have to train a new comptometer operator. No, thanks. 
I'm sorry to see the girl go, but I don't see what I can do about it. 

Case 19. The Baxter Case 

(Mr. Baxter's layoff brought to light curious social complications. Baxter's foreman 

was his tenant.) 

Characters : 

Mr. Baxter, toolmaker at the National Manufacturing Company. 
Mr. Avery, supervisor of industrial relations. 
Mr. Masters, foreman, manufacturing division. 

On Sept. 15, 1937, Mr. Baxter came to see Mr. Avery. 

Baxter: I've been laid off, and I would like to find out if you can do 
anything to help me. Other people in the department have less 
service, and according to the union I'm supposed to have seniority. 

Avery: I am sorry to hear you've been laid off, Baxter. But as far as 
seniority is concerned, we have no such agreement with the union. 
All we have is an understanding that service will be considered, 
provided all other things are equal, such as ability, versatility, 
and so on. 

Baxter: Well, I think there's something personal about this, and I 
don't like it. I don't give a damn about the job, because I can 
get a job somewhere else. But I just don't think it's fair. 

Avery: Well, not knowing what the facts are, I can't pass any judg- 
ment. But I'll be glad to give you a hearing if you give me time to 
look into this first. 

Baxter: All right. I wish you would. 

The next day, Baxter came back to the industrial relations 
office : 

Baxter: Well, I got the gate. 

Avery: What do you mean you got the gate? 

Baxter: Masters just told me that there was no work and I was to see 

the employment department. He said he had no further use for 

me. Now what? 
Avery: I'll see if I can contact Masters. Or would you rather have me 

talk to the superintendent before we talk to the foreman? Maybe 

we can work this out without your getting into a squabble with 

Baxter: I don't care who we talk to, we can't avoid a squabble with 

Masters anyway. 
Avery: All right, I'll call Masters. (Called Foreman Masters on the 

telephone and asked him to step into the office for a moment. 

Masters was able to come immediately.) 

Hello, Bill. You know Baxter, don't you? 



Masters: Sure, I know him. He worked for me, and I laid him off 

Avery: Well, he's entered a complaint saying he hasn't been treated 

fairly in the layoff, and I'd just like to have you go over this with 

Masters: There's nothing to tell. He's got the shortest service, and 

I had to let him go. 
Baxter: There are plenty of others in the shop with shorter service. 
Masters: Not toolmakers. There may be some lathe hands and die 

makers who have less service than you, but not toolmakers. 
Baxter: Well, what of it, can't I do lathe work? 
Masters : That's for me to decide. I'm keeping the fellows who can do 

my work. There's nothing personal. You're a good toolmaker, 

I'll say that for you any day, but you haven't been on a lathe for a 

long while. And you can't do die work, now, can you? 

(To Avery): Now here's a list of my toolmakers and their years 

of service. You can see for yourself that Baxter has been laid 

off according to seniority. 
Baxter: (To Masters) How would you like to get bounced after eight 

years of service? 
Masters: That's beside the point. I know it's hard, but still, I've got 

to run my department. 
Baxter: (half to Masters and half to himself) Well, I never could get 

along with you anyway. I don't know why in hell I ever let you 

have my house. 
Avery: Wait a minute, fellows. What's all this? Don't let's get into 

Baxter: Well, I didn't want to bring it in, but why can't Masters pay 

his rent? He makes plenty of money, more than I do. But. . . . 
Avery: Now, quit chasing up side alleys, Baxter. So far as I can see, 

whether Masters pay his rent or not has nothing to do with your 

layoff. That's his business. 
Masters: And I'll keep it so. 

(To Baxter) As I told you before, I'm not going to pay you any 

rent until you fix up the house. 
Baxter : Oh, yes, you are. I've just put through a sheriff's attachment. 

If you don't pay, it's going to be all over the shop. 
Avery: Now wait a minute, fellows, will you? This thing is getting too 

personal. But since both of you want to talk about it, let's see 

if we can't work it out. 

(To Masters) I shouldn't like to see a wage attachment brought 

in against you, Bill. You know as well as I do that sort of thing 

wouldn't do you any good here. 
Baxter: It's coming in though. He owes me six months' rent already 

and there's no reason why he can't pay. It's only $25 a month. 

Besides, if he doesn't like the place, why doesn't he get out? I 

ordered him to move Sept. 1, but he won't go. I had already told 

another fellow he could have the place, and he gave notice to his 

landlord. But Masters won't move. In all the five years he's 


been in my house he's never paid the rent on time and I'm sick of 

Avery: Well, Bill, after all, this is for you to settle. I don't want to 
interfere in your personal affairs. On the other hand, I might be 
forced to do so if Baxter brings in a wage attachment. I wish you 
could straighten this out somehow. 

Masters: Oh, there's nothing to it. He's only bringing this stuff up 
because he's got the gate. 

Avery: Now Bill, one thing at a time, please. Both of you insisted on 
talking about the house situation and there seems to be no doubt 
that Baxter is your landlord. As such he has a right to claim his 
rent. You're in a tough spot, Bill, particularly since Baxter is an 
employee of yours. 

Baxter: Well, he's going to pay me, if I have to force him to. 

Masters: All right, Baxter. I'll see that you'll get your money. But 
you're going to wait for it. 

Avery: Well, Bill, since you admit you owe Baxter the rent money, I 
think you ought to pay it now. If you don't, you're going to get 
into a nasty mess. It'll only cost you more money in the end, what 
with sheriff's and lawyer's fees. I suggest that you fellows get 
together and straighten this thing out. Then come back and see 

Masters: O.K. 

Both Masters and Baxter left the office. The next morning, 
Baxter returned: 

Baxter: I'm sorry to take up so much of your time with my private 
troubles, Mr. Avery. I know I shouldn't have brought up the rent 
question, but it was bothering me, and I couldn't help feeling that 
Masters laid me off out of spite. But let that go. As far as the 
rent is concerned, we're in the clear. I just want to tell you that 
this is all settled. Right after our meeting yesterday, Masters 
called up his wife and she paid my wife the rent. We're going to 
let them stay on in the house. 

Avery: Well, I'm glad you've got that straightened out. With the rent 
business settled, maybe we can put our whole mind on the layoff 

Baxter: Thanks a lot, Mr. Avery, but I've decided that I don't want to 
stay here anyway. I don't want to go on working for that guy. 
I've nothing against the company but I think it's best for all 
concerned that I leave. I got myself another job and everything 
is all right. I only want to make sure that there are no hard 
feelings, and, if I should want to, I could come back and talk to you 
about a job. 

Avery : You certainly can, and if you ever do need a job I hope I can 
fix you up. You've had a good record with us, and as soon as 
things pick up again we can always use men with your skill. 

Baxter :That's all I want to know. Thanks for everything. 

Case 20. The Case of Pierre Renault 

(Mr. Renault was laid off. He was given a hearing before the supervisor of industrial 

relations. Statements made at the hearing hinted at social complications. 

The foreman reconsidered the case and decided to give Renault a second 


Pierre Renault was forty-two years of age and a skilled 
mechanic. Since 1926 he had worked as wireman on radio 
panels at one of the National Manufacturing Company's subsidi- 
aries and on Jan. 6, 1936 was transferred to the local plant to work 
on test equipment. He was a member of the union, and the next 
year he was elected department representative. 

Work in the test equipment department was of a highly 
skilled and technical nature. Mr. Carter, the foreman of test 
equipment, was an outstanding technician and spent most of his 
time on the design and installation of apparatus and fixtures used 
for testing. Employees regarded him as somewhat of a genius 
at invention, and it was considered a privilege to be associated 
with him. His work, however, required frequent contacts with 
factory supervisors and many conferences with development 
engineers. As a result, Mr. Carter spent much of his time outside 
of the department. 

Mr. Carmichael, Carter's young assistant, assumed the role of 
working foreman, supervising the employees, distributing work, 
and so on. He had graduated with honors from a well-known 
technical school and was exacting in his requirements. He found 
it hard to get along with employees and prior to his appointment 
as assistant foreman had worked in the department as instrument 
construction and repair man. He did not go out of the plant 
during the strike, and it was generally known that he hated to 
deal with the union. 

On Sept. 17, 1937, Pierre Renault's name was put on the lay- 
off list. He filed a complaint with the union, charging discrimi- 
nation and stressing the fact that a man named Parkman, doing 
similar work, had only four years' service and was still being 
employed. Mr. Cameron, president of the union, forwarded the 
complaint to Mr. Avery, supervisor of industrial relations, and 



requested a hearing. A meeting was arranged for Sept. 21, at 
which the following people were present : 

Mr. Carter, foreman. 

Mr. Carmichael, assistant foreman. 

Mr. Cameron, president of the union. 

Mr. Renault, test equipment construction work. 

Mr. Avery, supervisor of industrial relations. 

Cameron: I think I'll open the meeting since I asked for it to be called. 
Mr. Renault here, has 11 years service and is being laid off. What 
I want to know is why he should be the one to go when Parkman, 
who is doing the same kind of work, has only four years and eight 
months. I suspect that Renault has been laid off because he is a 

Carter: Nothing of the kind. Renault's layoff is due to lack of work 
in the department. There's been no discrimination. The story 
simply is this: productive labor has dropped considerably, our 
department is a part of overhead, and we can't afford to be top- 
heavy. Renault is one of five others who are being laid off. 

Cameron : That's beside the point. I know that. I want to know why 
Mr. Renault's service isn't considered. He has n years and we 
know there are other fellows in the department who have only 
four years. I understand that Mr. Carmichael says Renault isn't 
as good a worker as the other fellow. We want him to prove it. 

Carter: As far as I'm concerned, seniority doesn't enter into the 
picture. I must run my department as efficiently as possible. 
Mr. Renault has been a good worker for us but he is limited. He 
isn't versatile enough to do any kind of a job that has to be done. 
He lacks analytical ability, which is most important in our work. 
My department is dropping down, and I must keep only versatile 
men who can do a variety of jobs thoroughly and quickly. I had 
to let Renault go, because Parkman is a better trained man and 
can do a better job. He's only thirty years old, but his training at 
the Bliss Electrical School makes him particularly valuable. He 
can follow a job through 100 per cent and has done so every time. 
Renault, on the other hand, can't follow drawings any too well, 
and it takes him three hours to do a job that Parkman can do in 
one. I don't say that he is loafing intentionally, but his mind does 
not seem to work as fast as Parkman's. Besides, Renault's not as 
careful as he might be. When he does finish a job there are apt to 
be " bugs" in it. 

Cameron: Well, it seems kind o' funny you have to bunch up all these 
criticisms at this time when we have a layoff. Why hasn't Renault 
been told of this before? 

Carter: Renault knows all about it. I said that I don't believe his 
slowness is intentional, and, while the department was running 
well, I saw no reason why I should complain or fire the man. I was 


perfectly satisfied to keep him on in spite of his deficiencies. So 
long as we had plenty of work from which to select, I could make 
good use of him. But I can't pick and choose a man's work now. 
He's just got to do anything that comes along. That's why I kept 
Parkman. He has the analytical ability that is needed to diagnose 
trouble quickly. In fact, this young fellow has come along so well 
that he can do a better job diagnosing trouble than I can. 

Cameron: You've got to be more specific if you want to talk to us. 
The manager said himself that seniority counts if a man can do the 
work. We believe that Renault can do his job, and we insist that 
he be kept. There's more behind this than you know, Mr. Carter. 
We've been watching your department for a long while. 

Renault: (to Carter) When did I ever fall down on any job? 

Carter: I wouldn't say exactly that you fell down on any job. You're 
all right if you have all the time in the world and aren't given work 
that requires analytical ability. All I know is that the last time 
you made a test fixture for the refrigeration department, we were 
criticized because the cost was twice as high as on a similar fixture 
that Parkman made. 

Renault: Well, nobody ever said anything to me about that. I've 
always worked faithfully and have done what I was told to do. 
When I worked at the other plant as a wireman I had to do more 
complicated work than I have to do here. And no one had any 
fault to find. As a matter of fact, it was Parkman who got fired 
because he couldn't make the grade. 

Carmichael: Oh, I know all about that. Parkman just couldn't get 
along with the foreman down there. He's been all right here and 
has been stepping right along. In my opinion he is twice the man 
Renault is. 

Cameron: Oh, he is, eh? Well, you needn't talk, Carmichael, we know 
you. You've always bucked the union. We believe that 
Renault's in the right, and we're going to fight for him to the limit. 

Avery: Now let's keep personalities out of this, Mark. Let's stick to 
the issue. All we've got to find out is whether or not Renault can 
do the work as well as Parkman. 

Cameron: That doesn't mean a thing. He's got seniority and we stick 
to that. 

Avery: Well, ability comes first. Seniority counts, provided a man has 
the ability to do the work. 

Renault: I claim that I can do all the work that is required. 

Carter: No one disputes your claim. You can do the work all right, 
but you can't do it as well as Parkman. And I can't be expected 
to run my department efficiently if I can't select the best men to do 
the job. 

Cameron: Well, this doesn't get us anywhere. If we can't settle the 
case here, we're prepared to take it to management. 

Avery: If you mean by that remark that a settlement not in your favor 
isn't a settlement, you'd better take it to management right now. 


My job is to see that all the cards are on the table and that every 
man is treated fairly. After all, it's up to Mr. Carter to decide 
whether or not he wants to keep this man. 

Cameron: All we're interested in is the fact that Renault has n years 
service and that he can do the work. 

Avery: True enough, but Renault's been with Carter only two years 
and we all know that the work he did before was not at all similar 
to ours. I can only agree with Mr. Carter that a foreman's job is 
to run his department efficiently, in a slack period as well as in a 
boom. Naturally, when his work is dropping down, he's going to 
keep the ablest fellow. 

Carter: Well, I'll tell you what we'll do, gentlemen. I'd be willing to 
take Renault back if he will buckle down to business, not kick 
every time he's assigned some work, and just begin to realize that 
his ability means something to him from the standpoint of keeping 
his job as well as seniority. I don't want to get involved in a 
squabble, but Mr. Renault's got to learn that n years of service 
with the company and membership in a union do not guarantee him 
the opportunity to stall on the job. 

Avery: Well, how is that with you fellows? 

Cameron: That's O.K. with me. 

Renault: Me, too. 

Avery: I'm willing to go along with this, too, provided Mr. Renault 
fully understands what was said. 

(To Renault) And, Mr. Renault, that doesn't mean the foreman is 
going to watch you like a hawk in an endeavor to find an excuse to 
fire you. Neither do we expect you to go back to the department 
with an "I-told-you-so-attitude." That's not going to help the 
situation at all. All it means is that now you have an opportunity 
to prove to these gentlemen what you can do. 


Case 21. Changing Trends in Foremen's Attitude 

toward Discharge at the New Process Rubber 

Company, Inc. and at the National 

Manufacturing Company, Inc. Plant No. 10 

In the last 25 years the attitude of foremen toward discharge 
has swung from one extreme to the other. Before the estab- 
lishment of the employment office at the New Process Rubber 








£ 18 
I 16 


£ 14 




§ 12 



















1918 1919 1920 1921 1922 1923 1924 1925 1926 1927 1928 1929 1930 1931 1932 1933 1934 1935 1936 1937 

Chart V. — New Process Rubber Company, Inc. Discharges: 1918-1937, factory 
employees for all causes. (No data for 1919, 1930, and 1932.) 

Company, foremen had unquestioned power of discharge and 
sometimes exercised it arbitrarily. Employment records show 
cases of employees being discharged one day and rehired the next. 
Discharges of this kind often caused later complications. For 
instance, in 191 5 the canvas-footwear department had consider- 




able difficulties with "started heels." The defect was frequently 
caused by improper hand rolling that did not fuse the outsole 
and the heel. Sometimes, however, this same defect was brought 
about by atmospheric conditions or by the improper mixing of 
cement, which occurred in another department. The department 
superintendent inaugurated a special campaign to eradicate the 

15 r 

c 5 


-i nn 
II 111 


<-- 1918- 


^-1920-* <-l921--^ ^--1922-* *H923-* <- 1924- 


c 5 

1 11 1 111' I n n in n 


c ^--1925--^ <-l926--> <--l927-* --I928-* <-l929--> ^-1930- 


\ F7 }\ 


1933--* <--1934~> <~I935-* <~I936-*- <~I937~> 

B Incompetence Y//A Misconduct I I Unreliability 

Reasons for . 
discharge ' 

Chart VI. — New Process Rubber Company, Inc. Discharges: 1918-1937, factory 


defect of started heels. The foreman who had been raked over 
the coals relieved his annoyance by storming into the shop and 
cracking the whip. He called his men together and threatened: 
"The next man who has any started heels returned is fired. That's 
all." Unfortunately, the next 50 pairs of shoes with started 
heels were returned to Prestorato, one of the best men in the 
department and a man with 10 years of service. The foreman 
must have realized that the trouble could not be attributed entirely 


to this man. Nevertheless, he feared that his prestige would 
suffer if he did not carry out his threat. Prestorato, therefore, 
was summarily discharged. The next day, the foreman was in a 
more reasonable frame of mind, and, since he badly needed the 
man, he rehired him. In 1930, Prestorato claimed 25 years ser- 
vice and eligibility for an extra week's vacation. He was unaware 

15 r 


I 5 


+- <-|9l8--> <-- I9I9-* ^-1920-* ^-l92l--> ^--1922-* «--l923~* ^- 1924— 




j MM ll l^ifl H^n 

c 5 

m mV\ m m 1 ■ f^fl m mV\ l ^n 


<-l925--> <--l926-=- ^ — 1927--*- <- I928~> *~I929~^ <--l930~>- <--l93l- 


<--l932-> ^-1933-^ <-l934--> <-- 1935--> — 1936-> <-l937--> 

R dischar f qe ** Incompetence &% Misconduct ^^Unreliability 

Chart VII. — New Process Rubber Company, Inc. Discharges: 1918-1937, factory 


of the company rule that any discharge automatically broke a 
man's service record. Accordingly, his discharge even though it 
lasted only one day, had made him a new employee when he 
started again. 

With the establishment of the employment office, the employ- 
ment manager was able to prevent arbitrary discharges. It 
became a recognized practice for a foreman to "give cause" and 



for every contemplated discharge to be investigated by the 
employment department. 

By 1937 the pendulum had swung to the opposite extreme. 

The employment manager was then faced with the extreme 

reluctance of the foreman to discharge any employee at all. 

Every discharge was vigorously contested by the union. If a 



<— -I927-— > 




• 1929- 





iH Incompetence 
m Misconduct 
□ Unreliability 


number E&3 

-c 1936 *- -<— — 1937 > 

Chart VIII. — National Manufacturing Company, Inc. Discharges: 192 7-1929; 
1936-1937, factory employees 

worker had to be discharged, the foreman attempted to make the 
employment manager do it. Charts V, VI, VII illustrate the 
marked decrease in discharge cases since 1930. 

For comparable figures as regards discharges at the National 
Manufacturing Company, see Chart VIII, National Manufacturing 
Company, Inc., Discharges: Factory Employees, per cent of 
Enrollment, 1927-1929; 1936-1937. 

Case 22. Alfredo Bonaccio 

(Illustration of a supervisor's reluctance to discharge an employee even "for cause," 
New Process Rubber Company, Inc.) 

Characters : 

Mr. Dow, foreman, maintenance department. 

Mr. Randall, employment manager. 

Mr. Hemingway, superintendent, maintenance department. 

Bonaccio, a shoemaker, had been with the company for 15 
years when his attendance began to be very irregular. Investiga- 
tion disclosed that a weakness for liquor was responsible for his 
unreliability. As a shoemaker, Bonaccio was employed on an 
assembly conveyor, and his unexpected absences seriously inter- 
fered with the production of his fellow workers. They complained 
to the manager of industrial relations that the foreman was too 
tolerant in putting up with Bonaccio's lapses. The industrial 
relations manager discussed the case with the employment man- 
ager. It was decided to discipline Bonaccio but give him an 
opportunity to rehabilitate himself. The employment manager 
arranged a remedial transfer to the maintenance department, 
where Bonaccio was given a job as a sweeper. The transfer was 
also a demotion, since the job of sweeper carried with it a reduced 
rate of pay. Mr. Hemingway, superintendent of the maintenance 
department, warned Bonaccio that he could not hold this job 
if he failed to report regularly. 

For six months, Bonaccio's attendance was excellent. Then 
he disappeared for a week and could not be located at his home or 
elsewhere. He showed up on a Monday morning rather the worse 
for wear and insisted that he had been sick. The foreman tele- 
phoned the employment manager: 

Dow: Say! Bonaccio has just showed up. He's still half drunk. 

What am I going to do with him? 
Randall: Suspend him for a week and warn him that if it happens 

again he'll be discharged. 
Dow: Wouldn't it be more effective if you told him? 
Randall: O.K. Send him over. 



The employment manager suspended Bonaccio for a week and 
informed him that a repetition of his offense would result in 

Bonaccio returned the following week and went back to work 
sober. Three weeks later, however, he left work during the 
noon hour and stayed away for two hours. When he returned, 
he was in no condition to go to work. The foreman again tele- 
phoned the employment manager: 

Dow: Say, Randall, Bonaccio is drunk again. He went out somewhere 
this noon and was gone for two hours. Now he's back here 
fumbling 'round the clock trying to ring his card. But he's got 
such a "bun on," he doesn't know whether he's coming or going. 
I can't let him go to work in this condition. What am I going to 
do, now? 

Randall: There's only one thing to do, Dow. We talked that over 
before. The man has been warned and you'll have to discharge 

Dow: Hell! If I discharge him in his present condition he won't even 
know he's been fired. Don't you think I'd better send him home 
and tell him to come back tomorrow morning and see you? 

Randall: Well, all right. But send his discharge notice right through, 
will you? 

Dow: Well, I'll have to talk to Hemingway about that. 

Randall: That's up to you. Only let's have some action right away. 

The next day Bonaccio failed to report. Meanwhile the fore- 
man had seen his superior, Mr. Hemingway, who came to see the 
employment manager: 

Hemingway: Look here, Randall, what are you going to do about this 
guy, Bonaccio? 

Randall: I'm going to do nothing. You fellows are going to discharge 

Hemingway: Discharge him, like hell! I'm going to turn Bonaccio 
right back to you, and you can do anything you want with him. 
He's not my baby. You transferred him to me from the shoe 
department where he had been for 15 years. If I had known he 
was a lemon I'd never have let you get away with it. 

Randall: You knew what was wrong with him, George. Whenever he 
went off on one of his sprees he would disorganize his group unit by 
failing to show up for work. When we transferred him he had 
never been drunk on the job and that's why you agreed he could do 
no harm as a sweeper and that, maybe, a demotion might be 
enough of a jolt to cure him. 

Hemingway: Yeh! That's how you got away with it. But look at 
him now. This is the second time that he's been drunk on the job. 


And what the hell am I going to do with him? You know damn 
well that I've had two tough cases of discharge already the last 
year. In each case I was right in letting the man go, and my 
decision was finally upheld. But each time the union took me for 
an awful ride. And, believe me, never again, if I can help it. So, 
you put him right back where he came from and let somebody else 
be the goat this time. 

Randall: Well, we obviously can't do that, because that would be 
doing exactly what you are accusing me of. And it is our policy 
never to make a transfer without disclosing all the facts in order to 
get full cooperation. 

Hemignway: Well, suit yourself. All I know is, I'm not going to be 
taken for another ride. 

Randall: I understand how you feel, George. If you want me to, 
I'll be willing to sign the discharge card. Just send Bonaccio to 
me, and I'll take care of the whole thing. But the fact remains, 
he'll be discharged from your department. 

Hemingway: O.K. But, boy! just try and wish another lemon off on 
me, that's all. 

Case 23. The Kuczinsky Case 

(Case of a nonunion employee who had been discharged for fighting and who 
petitioned for reinstatement.) 

On Apr. 3, 1937, Mr. Avery, supervisor of industrial relations 
at the National Manufacturing Company, received the following 
report from Captain L. Rawlins: 

Police Report 

At 7 A.M. Lieutenant Riley received a telephone call from H. 
Anderson, Assistant Foreman, A- 19, to come down to that department 
at once as there was trouble going on. Lieutenant Riley upon arriving 
found that two of the employees had been having some dispute and that 
one of them, Anton Kuczinsky, a set-up man in A- 19 (Check 713) had 
struck the other employee, Stanley Demerski, a die setter in A- 19 
(Check 975) in the mouth, cutting part of the mouth which required 
half a dozen stitches (taken care of by Dr. Daley). I understand that 
Kuczinsky had asked Demerski for some papers pertaining to his work. 
Demerski said he didn't have the papers. Kuczinsky then remarked 
that he would like to punch Demerski in the jaw and then did punch 
Demerski in the mouth. Demerski made no attempt to fight back. 
From what I have learned there seems to have been trouble or feeling 
between these two men on account of Kuczinsky worked all during the 
strike and is not a union man. H. Anderson (Assistant Foreman) made 
out a quit slip for Kuczinsky. Mr. Cameron, President of the Union, 
who was in A- 1 9, spoke about arresting Kuczinsky but this could not be 
done unless the employee who had been assaulted went along and signed 
the complaint. (He was not willing to do this.) 

(s) Captain L. Rawlins 

Investigation of the case did not bring out any additional facts, 
and Mr. Avery affirmed the foreman's discharge. 

On Apr. 4, 1937, the works manager received a letter from 
Mr. Kuczinsky, which he forwarded to Mr. Avery with the recom- 
mendation that he use his own judgment. The letter read as 
follows : 

April 3, 1937 
Mr. E. L. Abbott 
General Manager 
National Manufacturing Company 

Dear Sir: 

This morning occurred an incident of considerable consequence 
to me: I have been discharged for fighting. Following are some of 



the events leading up to the issue, and I leave you to render an 

I am and have been aware all along that there exists a certain 
very rigid shop-rule against righting. And that awareness 
accounts for the year and a half that I have worked there. I got 
the job just seven working days before the strike, but in those seven 
days I laid the foundation of a deep enmity in the man I popped 
this morning. I voiced my views on the then impending strike, 
which, unfortunately failed to coincide with his. I was against it. 
And when I returned to work four days before the strike ended, 
upon the invitation of my foreman, his eyes turned upon me, were 
not pleasant to see. In the beginning of our workaday relation- 
ship — after the strike — he was content to treat me with silent 
contempt, all of which was all right with me. But gradually he 
brought voice, manner and words into play, till it was with the 
utmost difficulty that I restrained myself. Daily I was subject to 
slights, insults and incivilities which nearly drove me frantic. I 
swallowed it all in the sweet name of peace. On several occasions 
I complained to the foreman, but I could get no satisfaction there. 
After all I could not quote a single off-color word he used which 
might warrant official action. Naturally, I couldn't carry around 
a dictaphone and a camera with which to get evidence that his look 
and tone were offensive. The stock palliative became: "Try to 
keep out of his way." 

But keeping out of his way was impossible in view of the fact 
that I depended on the output of his presses to supply work for my 
own. From time to time I simply had to have information relative 
to the job which only he could give. He never failed to take full 
advantage of these encounters. Where a "no" or "yes" or 
"maybe " might have sufficed, he instead resorted to loud denuncia- 
tions of my temerity to question him on the subject. His attitude 
was so stupid and unreasonable that it left me helpless and speech- 
less. You can't find words to answer the rantings of an imbecile. 
I used to walk away, my nerves in such a turmoil that I became 
dizzy and shaken. I finally resorted to threats — that if he con- 
tinued these stupid persecutions I'd wait for him outside the gate. 
This, if I had carried it out, might have simplified matters a great 
deal. But I'm not cold-blooded enough to wait hours for my 
revenge. I had but to laugh once and the storm in my soul was 
over. So this went on for months and months. 

Then he grew bolder, convinced that I was only bluffing. 
Today he committed an outrage which no man worthy of the name 
could tolerate: He snatched a sheaf of route cards I had picked off 
his truck, and was thumbing through, looking for a certain specific 
one from which to copy certain information I needed before return- 
ing them, out of my hand. I'd have been justified in slapping him 
down there and then, but didn't. I informed him that I had 


suffered my last indignity at his hands, that I would certainly 
"let him have it" the next time. He said, " Go ahead," and I did. 

Now, after an interval of calm reasoning, I'm not so sure that I 
hadn't played directly into his hands. I wonder if he had not 
actually planned to good (sic) me into an act which would cost me 
my job. There is no divining the workings of a perverted mind, 
and it is just possible that he was willing to suffer momentary pain 
for the lasting satisfaction of seeing me disgraced. 

Now the primary object of this letter is to point out to you 
the disadvantage to the National Manufacturing Company of 
dispensing with my services. I shall not here repeat what I already 
said to Mr. Kendricks (employment manager), MY (sic) claim 
to have saved the company thousands of dollars through the 
improvements I made on the machines under my care can be 
verified easily. I further claim that those Index Presses cannot 
be operated efficiently without me. Those machines exact a 
peculiar treatment, a treatment such as is not readily found in 
the average die setter. 

I think I have covered all the main points of my petition. I 
am aware, however, that you can scarcely be expected to re-instate 
me assuming I have succeeded in convincing you of the justice of my 
act over the heads of those who are more intimately concerned 
with the matter and its disposition. I can, at least, be an instru- 
ment in setting a precedent by which matters of a similar color 
can be dealt with a bit more equitably in the future. Would it 
not tend to discourage these morons if the price paid for their 
squelching (sic) were less — say a month's suspension without 

(s) Anton Kuczinsky 


Case 24. Statement of Practice at The New 
Process Rubber Company, Inc. 

A. Training New Workers 

There have been three outstanding stages of development in 
the training of new workers at the New Process Rubber Company, 
Incorporated: (1) the apprentice system, (2) the vestibule school, 
and (3) the method of teaching on the job by staff members. 

1. The Apprentice System. The earliest apprentice training 
method at the New Process Rubber Company consisted in placing 
an experienced workman in charge of a beginner, with the object 
of teaching his particular operation in the making of footwear. 
In return for his time and effort in acting as instructor, the experi- 
enced workman received the benefit of the apprentice's production 
in his own pay envelope until the helper was able to operate on his 
own. The advantages of this method were that it freed the 
foreman from teaching detail and permitted him to devote his 
attention chiefly to production, and that the apprentice learned 
his job as a member of the group under actual working conditions. 
The disadvantages, however, outweighed the possible benefits. 
Uniform training methods and ultimate uniformity of operation 
were difficult to attain. Secondly, the training period was unnec- 
essarily prolonged for several reasons. The experienced workman 
was not always a good teacher. Even if he was, there was no 
incentive for him to hasten the teaching process. If he did, he 
would only deprive himself of the additional earnings of his 
helper. There was a temptation to teach the helper only those 
operations which increased his value to the teacher and to 
withhold the knowledge that would permit him to operate inde- 
pendently. This delay kept the new employee working at low 
apprentice wages when he should have been ready to work on an 
incentive basis and often led to discouragement and quitting 
the job. This increased the labor turnover and resulted in high 




and hidden training costs. The apprentice system, therefore, was 
open to criticism on both human and technical grounds. The 
immediate occasion of its discontinuation, however, was the World 
War with ensuing increased production and decreased labor supply. 
The development of a special training school was the next step 

2. The Vestibule School. As implied by its name, this school 
was separate from the actual work shop. It was set up as a 
model manufacturing department with tools, equipment, and 
methods duplicating those found in the shop. Employees, 


Laster ® 

# Laster 

Chart IX. — A Shoe-making unit during the vestibule school era. 

selected for their training ability, were assigned to instruct the 
new workers. The teachers were put on salary and received 
earnings somewhat higher than the average weekly earnings in 
the shop. The shop foremen were entirely relieved of responsi- 
bility for training new workers. Large groups of new employees 
could be trained simultaneously and taught their occupations 
under the following uniform conditions. Shoemaking operations 
were separated into three occupations: (i) lasters, (2) upperers, 
and (3) outsolers. The first two operations were performed by 
women; the last, by men. A complete working unit consisted of 
one man and two teams of women who worked at a table that 
was shaped somewhat like an old-fashioned bootjack. The school 
contained as many units as were needed to accommodate the num- 
ber of new employees that were selected for training. As a rule, 
each teacher supervised four to five tables. 

At first the vestibule school seemed to be entirely successful. 
But certain difficulties soon became apparent. These difficulties 


grew out of the vestibule school's isolation from the shop and the 
fundamental difference between the relationships of teacher-pupil 
and foreman-worker. As years went by, the school became 
increasingly different from the manufacturing department it was 
supposed to duplicate. Rapid changes were steadily transforming 
shop departments at a rate that the school did not keep pace with. 
The school lagged behind the shop in manufacturing technique 
and equipment and gradually developed a character of its own. 
The pressure and speed common to production departments were 
lacking in the school where the chief interest was in the pupil's 
progress. The teacher thought himself successful when the 
beginner had learned to make a shoe. Little attention was paid 
to the time and effort required by different pupils to learn the 
same operation. In fact, a conscientious teacher was apt to spend 
a disproportionate amount of time on the pupils who had the 
most difficulty. The teachers often worked with a team that 
lagged behind, thus speeding up its production and giving an 
unrealistic picture of the team's performance. The foreman's 
interest naturally centered on production (i.e., the speed and per- 
fection of operation) rather than upon the worker's knowledge 
of his trade. This was a new experience to pupils who had been 
helped too much by the teacher, and many of them could not 
adjust to the speed and efficiency of a normal working group in 
the shop. They missed the encouragement of the teacher, on 
which they had come to depend, and soon became discouraged. 
This situation called for a program of retraining, the burden of 
which was at first thrust upon the foreman. There were times, 
however, when a foreman was too pressed by production demands 
to assume the responsibility for retraining. The consequent 
neglect of the new employee's interest, in sharp contrast to the 
personal attention that he had received in school, increased his 
sense of failure and often led to voluntary quitting. As a means of 
remedying this situation, management assigned instructors to 
guide maladjusted employees through the transition period in the 
regular production department. This arrangement was the first 
step toward a new method of training employees that by 1928 
had entirely displaced the vestibule school. Another factor con- 
tributing to the development of a new training policy was the 
appearance of rapidly changing styles, running into hundreds of 
seasonal varieties. This style factor, together with hand-to- 


mouth buying of small quantities for short-time delivery, called 
for great flexibility in plant operation and short training schedules. 
This need was met by the advance in manufacturing methods from 
small work tables to automatic conveyors and the development of 
staff experts in time and motion analysis. 

3. Teaching on the Job by Staff Members. Motion-study at 
the New Process Rubber Company was a method used to estab- 
lish correct working procedures. It involved the arrangement of 
machines, equipment, tools, and materials for most convenient 
and effective use. Its aim was to eliminate unnecessary and 
unsafe practices and to determine standard motions to be used 
by all employees on specific jobs. This standard practice per- 
mitted the employee quickly to acquire skill in accepted working 
procedures and to attain full earning capacity in a short time. 
Photography played an important part in training employees, not 
so much by the use of motion pictures as by the use of snapshots to 
abbreviate and clarify job instructions. Pictures displayed the 
operator's hand positions in an unmistakable manner that no 
amount of verbal description could equal. 

With the development of the motion-study method, the vesti- 
bule school disappeared. All job training at the plant came under 
the direction of a training supervisor who was assisted by a corps 
of versatile instructors. These instructors had no production 
responsibilities and devoted their entire time to teaching only. 
They were shifted about the plant wherever instruction was 
needed and trained workers in the department and on the job. 
When little training needed to be done, these instructors were 
assigned to different production jobs for the purpose of learning 
the job method and increasing their skill as instructors. 

Instructors were assigned on a sliding scale that permitted 
a gradually d ecreasing per capita cost of training. At first instruc- 
tion was practically individual, the teacher devoting several hours 
at a time to one pupil to make sure that the worker began with the 
adoption of correct working procedures. After the foundation 
had been laid, one instructor would supervise several pupils. The 
table on p. 137 shows the increasing number of pupils per instruc- 
tor and the decreasing per capital cost of instruction over a period 
of 14 days' training. 

To accommodate such an individualized training program to 
a limited staff of instructors, training schedules were staggered. 



For instance, at the beginning of one week, conveyor A was put 
into operation. For the first few days three to four instructors 
were in charge of training. By the end of the week a second 
conveyor was put into operation, and two instructors would be 
withdrawn from conveyor A. These two instructors and one 
other would take charge of the intensive training required by the 
new unit. 

Teaching Schedule and Instruction Costs Per Operator 


Number of 

Number of 

Cost per operator 

of days 



(instruction cost only) 





































































Since 1934, the retraining of transferred employees 1 consti- 
tuted the greater part of the training program. The development 
of employment stabilization increased this type of training. It 
was handled by staff instructors in exactly the same manner as 
the training of new employees except for the difference in the 
schedule of wage payments during the training period. New 
employees started at a beginner's rate and worked up to the 
job rate. The transferred employees were guaranteed the average 
earnings for the job performed throughout the entire training 
period. In this way they suffered little or no loss of income, 
provided they met the schedule. If, on the other hand, they 
failed to meet the schedule at the end of the training period, they 
went on their own and were paid according to actual output. 
These transfer wage guarantees were a source of considerable 
expense to the company, but, in the opinion of management, the 
expenses involved were less than the intangible losses that resulted 

1 See Section II, Transfers, pp. 57-97. 


from a high labor turnover. The program of transfer and retrain- 
ing offered an incentive to the worker to maintain or beat the 
established schedule and provided security of income as well as 
of employment. It made possible the selection of the best quali- 
fied candidates without a sacrifice in their earnings. Prior to the 
establishment of transfer guarantees, the transferred employee 
suffered a loss in earnings while learning a new job, whereas the 
employee who was not transferred was spared the inconvenience 
of making adjustments and remained at his customary job with- 
out loss of income. Of course, he was exposed to the danger of 
layoff in case of a sudden drop in production. 

B. Training Potential Supervisors 

In the early years of the New Process Rubber Company, 
supervisors of factory departments were selected from the ranks 
according to demonstrated skill in manufacturing methods and 
indications of leadership ability. There was no system other than 
mere trial and error. If a supervisor failed to make good he was 
sent back to the bench. 

Beginning in 191 7, some college-trained men were hired as 
potential supervisors. They were given positions as assistant 
foremen or located in such office jobs as permitted free access to 
plant departments. The factory cost department, standards 
department (time and motion study), pattern room, or the ticket 
office offered such opportunities for becoming acquainted with 
the problems of factory-department supervision. These jobs 
served the young college graduates as stepping stones to promotion 
and offered them an opportunity to demonstrate their ability. 
But even this procedure was still haphazard and could scarcely 
be called supervisory training. The jobs were only slightly above 
the shop level, and little effort was made to employ a man in 
accordance with special abilities. It took years for the individual 
to find his place, and many maladjustments developed. 

In 1927, a systematic training program for college graduates 
was put into effect. Management set up a period of 9 to 12 
months as one of preliminary training before the candidate was 
assigned to a regular job. He started on some production work 
in one of the final assembly departments, or the packing depart- 
ment, where he had an opportunity to become familiar with the 
product manufactured and its quality requirements. He was 


then transferred to a department where he learned the basic 
manufacturing processes. From here he followed the product 
through all its stages until he again arrived at the final assembly. 
In each department, the potential supervisor successively held 
various key jobs. After he had become thoroughly familiar 
with the essential manufacturing processes he was given oppor- 
tunities to participate in working out management problems. In 
addition to this practical training there was some classwork. One- 
half day each week, the candidate attended classes where a super- 
visor in charge of training discussed company policies and systems. 
In this way the potential supervisor was able in one year to acquire 
the practical knowledge that formerly required several years. 
But even more important than this directed training was the 
final selection and placement of each successful candidate. Dur- 
ing his period of training, the potential supervisor was observed 
not only by each department head in turn, but also continuously 
by the employment manager. Management thus obtained a 
good estimate of his abilities and a clue as to the department in 
which he was most likely to succeed. 

During the depression of 1 930-1 933 this program for training 
college graduates as potential supervisors was suspended. As an 
alternative, management considered the work of servicing con- 
veyors as one of several jobs where a reservoir of potential super- 
visors might be developed. Work in the cost department was 
considered another avenue to such promotion. However, the 
status of attendants in the company organization had never been 
clearly defined, and the character of the job changed with the 
caliber of the men who held it. This complicated the informal 
training program that had been set up. 

The job of attendant had come into being as the result of 
complaints by foremen that they were required to spend too much 
time as glorified errand boys, chasing stock shortages, supplying 
materials, and replacing missing parts. By delegating these 
duties to young men, management left the foremen free to devote 
their time to department organization and the supervision of pro- 
duction. The foremen were also relieved of much clerical work 
by the assignment of women clerks to this detail. At this stage, 
then, the job of attendant was purely auxiliary and on the clerical 
level. The duties of attendants consisted in supplying materials 
to operators engaged on conveyor assembly and replacing spoiled 


or missing parts. In the exercise of these duties, attendants had 
constant opportunities to interview supervisors of departments 
from which these materials came. In this way they could obtain 
excellent insight into the problems and methods of rubber footwear 
manufacturing. Because of this, management came to regard 
the job of attendants as a good training ground for potential 
supervisors. During the depression many young college men 
took advantage of this opportunity to prepare themselves for 
subsequent promotion. These college men proved so successful 
that supervisors assigned more and more responsibility to them. 
In addition to supplying materials and replacing shortages, 
attendants became responsible for maintaining production sched- 
ules, regulating conveyor output, passing on the quality of 
materials used, and maintaining general quality standards. At 
this stage, the job had risen far above the errand-boy level and 
required young men of exceptional ability. This resulted in the 
gradual displacement of the less capable boys by others of high 
school or college training. 

This gradual change in the nature of the job was reflected in 
the method of wage payment. At first, attendants were remun- 
erated on an incentive basis. But the rapid changes in the require- 
ments of the job made it impractical to maintain standards, and 
attendants were finally placed on straight hourly rates or day 
work. With the removal of the incentive system it was found 
that the more capable attendants, who either were given the 
more difficult jobs or were handling a larger volume of production, 
were not being compensated in proportion to their increased value 
to the company. To remedy this discrepancy the superintendent 
of the footwear division (who employed the greatest number of 
attendants) devised an attendant's rating sheet, which was 
adopted for use throughout the plant. An essential feature of 
this rating system was a sliding scale of rates, which enabled 
management to pay the more capable men a higher hourly rate. 
In order to coordinate departmental practices with respect to 
attendants, management on Dec. 16, 1935, formulated the follow- 
ing policy : 

Policy for Attendants 

All units which require the servicing of material or equipment to the 
operators will be provided with attendants. It will be the responsi- 
bility of the department to assign to each attendant a sufficient number 


of units with the duties appertaining thereto to insure the most eco- 
nomical operation of the units. It will also be the duty of the depart- 
ment head to see that attendants are thoroughly trained in all duties 
pertaining to their work. Such duties involve: 

Supply operators with stock. 

Remove empty equipment. 

Take odd tickets (record of material shortage, i.e., shortage replace- 
ment order made out to the department from which the goods 

Supervise cleanliness and orderliness of conveyors, floor, etc. 

Investigate validity of odd tickets, i.e., operator's claim that the 
material supplied to him was less than the amount stated on the 

Assist production aides in maintaining an even flow of work in units 
and take necessary steps to avoid delays. 

Prevent waste of material by operators. 

Deal directly with other departments for short lasts, materials, etc. 

Take full charge of quantity production but still reporting to 
Production Aides and as they may direct. 

These responsibilities are to be taken on gradually and usually in 
the order in which they are listed above. 1 

All new men for these positions should be interviewed and selected 
on the basis of the following requirements: 

1. They should attain a percentile of 60 on the Standard Intelligence 
Test. This test to be administered during the interview by the 
employment man. 

Any man who falls below 60 should not be given any further 
consideration for this job. 

2. A high school education or its equivalent. 

3. a. To have been gainfully employed at least two years, or 

b. If in school, to have participated in such extracurricular 
activities, social activities, or part-time employment for a 
period of at least two years, or 

c. The result of interview and intelligence test to be such that, 
in the opinion of Employment Department and departmental 
head, (a) and (b) can be waived. 

4. Possess the following physical qualifications: 

a. To be of athletic build without any serious defects. 

b. To be not more than 15 per cent below or 15 per cent above 
normal weight for age and height. 

c. To be without serious defect in visual acuity. 

d. To possess no defect in color vision. 

5. To be between 18 and 23 and unmarried. 

6. To possess the potential capacity to rate favorably on all factors 
on the rating sheet for this job and to tend definitely toward an 
objective personality. 

1 Incidentally, this order retraces the evolutionary development of the job. 



At the end of three months, attendants will be rated by the super- 
visor in the department in which they work, using the attached sheet, to 
be called "Attendant's Rating Sheet." 

Salaries: The starting rate for attendants will be 49 cents an hour 
and maximum rate 65 cents. Pay will be graded according to the 
rating that a man may attain on the rating sheet, according to the 
following schedule. 

ing, Per Cent 

Base Rate, Cents 



















Attendants will be rerated at least every six months and wages 
adjusted according to the ratnig. 


Attendant's Rating Sheet 

Rated by_ 

0-20 Intelligence. Mental capacity, ability to learn, originality, power of 

0-20 Personality. Self control. Ability to impress others. 

0-10 Responsibility. Willingness to assume responsibility and ability to 
handle all responsibilities connected with the jobs. 

0-10 Reliability. Consider perseverance, accuracy, and general dependa- 
bility. _ 

0-30 Efficiency in Operation. Results obtained (Odd tickets, completed 
brackets, odd shoes etc.) 

o— 10 Physical condition. Muscular strength to be considered as an asset; 
absence of sickness and steadiness of attendance. 

In connection with the use of the proposed rating sheet for service 
operators I suggest that we use the following values in marking from: 




1-2 Unsatisfactory 
3-4 Poor 
5-6 Fair 
7-8 Good 
9 Very Good 
10 Excellent 

1- 5 Unsatisfactory 

6-10 Poor 
1 1- 1 3 Fair 
14-16 Good 
17-18 Very Good 
19-20 Excellent 

1- 9 Unsatisfactory 
10-16 Poor 
17-21 Fair 
22-25 Good 
26-28 Very Good 
29-30 Excellent 



By the end of 1936 it was apparent that attendants had infor- 
mally attained the status of assistant foremen, and that the job 
was no longer primarily of an auxiliary nature but was looked 
upon as a stepping-stone to future promotion. Both these facts 
were recognized in the revised policy for attendants that was 
officially approved Apr. 19, 1937. Furthermore, a new rating 
sheet was developed, which entirely omitted the factor of muscular 
strength and stressed intellectual and personality qualifications. 

Revised Policy for Attendants 

Definition. An attendant is one to whom has been assigned the 
following responsibilities: 

Duties. — Primarily these consist of supplying such units with parts, 
material or equipment necessary to the unit and removing empty 
equipment therefrom. In addition to these duties he may be held 
responsible for the cleanliness and neatness of the unit, the responsi- 
bility of following and correcting shortages and waste of material by 
contacting the operators or supervision within the department, or 
supervision in departments in which such occurrences may take place. 
He may further be held responsible to check lasts and materials 
previous to their delivery to operators to insure an uninterrupted flow 
of production and to make necessary changes of sequences to insure 
such continuous production. Finally he may be given charge of the 
production of the unit. 

He will also assist the foreman in securing harmony and co-opera- 
tion between the various individuals in the unit. 

Training. It will be the responsibility of his foreman, assisted 
by the foreman of odd tickets, and the training department, to see 
that he is properly trained in the above duties. 

Wages. All attendants who are not transferred directly from 
other departments will be drawn from the odd- ticket department. 
The starting rate in the odd-ticket department will be 53 cents an hour 
and this will be increased to 75 cents when they are transferred to 
servicing. Thereafter, increases will be made in accordance with 
the Attendant's Rating Sheet, dated 4/19/37. 

Rating Sheet. Attendants will be rated on five factors: 





Efficiency in operation. 

The maximum points obtainable in the first four items are 15 for 
each and for the last (efficiency) 40 points. 

Attendants will be rated by their immediate foreman or Production 
Aide and the number of points warranted placed after each factor. 
A chart of values is appended to the rating sheet for the guidance of the 


rater. Also, a chart correlating the total points received with the 
proper corresponding base rate. 

Within three months from the date of employment, he will be rated 
on the performance of his duties as enumerated in the preceding para- 
graph on an "Attendant's Rating Sheet," his total rating applied to 
the schedule appended to the rating sheet and a "wage increase request" 
forwarded to the Divisional Superintendent, if warranted by the 
schedule and approved by the Department Superintendent. 

A committee initiated by the Divisional Superintendent will be 
formed for the purpose of reviewing and co-ordinating attendants 

An attendant has the privilege of inspecting his own rating sheet 
with his foreman, at any time, and may appeal to the Department 
Superintendent any unsatisfactory rating. 

Thereafter an attendant will be rated at least every six months and 
the same procedure will apply. 

Should any decreases be indicated by such ratings the attendant 
will be informed and every assistance given him to improve his per- 
formance. If, upon the next succeeding rating sheet, he still does not 
merit his base pay it will be reduced to the rate shown on the schedule 
as applying to his case. Attendants ordinarily will be employed on 
the "F" (Factory) Roll but in cases where an amount of supervision 
is required that prevents them from qualifying to vote as factory 
employees they will be transferred to the "E" roll upon request of the 
department superintendent and approved by the Divisional Super- 
intendent and Vice President in charge of Production. Likewise, if 
conditions warrant, they may later be transferred back to the "F" roll. 

Employment Requirements. That a man be able to attain a rating 
of 50 on the intelligence test in the Employment Office and that no man 
be sent to the factory for a personal interview until he has taken the 
test and attained the necessary rating. 

Promotions to Other Jobs. When requests are received for attendants 
to other jobs, those men who appear to be best qualified to fill the 
position will be selected for interview by the employment department 
and the person making the request. 

Selection of the man for any given job will be determined by the 
employment department and the department in which the position is 
to be filled. 

Rating Sheets will be taken into consideration but will not be the 
sole deciding factor for advancement to other jobs. 

Despite this recognition, attendants continued to be on the 
factory pay roll and were thus subject to the regular employee 
rating sheet procedure for layoff consideration in the event of 
decreased production. Attendants were thus rated twice in 
accordance with their membership in two different groups. On 
the one hand, they took their place as regular factory employees 


in a specific department. Status in this group was determined by 
the comparative rating obtained on the Employee Rating Sheet. 
In these ratings not only ability, but also length of service and 
other factors, played a definite part. On the other hand, attend- 
ants formed a special occupational group in the company as a 
whole. In this group, status was determined by their own special 
rating sheet on which personality and intellectual qualities were 

Attendant's Rating Sheet 

Name Date 



Rated by 

0-15 Personality 

(Self control) (Interest in problems of others) (Ability to put others 
at ease) (Appearance). 

0-15 Responsibility 

(Stability) (Perseverance) (Reliability) (Willingness to assume 
blame without alibi). 

0-15 Judgment 

(Perception) (Vision) (Analytical powers) (Observation) (Con- 
centration) (Does not scatter his efforts). 

0-15 Leadership 

(Training ability) (Inspiring confidence) (Securing co-operation) 
(Creating interest and enthusiasm) (Initiative) (Willing to act on 
own judgment) (Promotes new ideas of others as well as his own). _ 

0-40 Efficiency in Operation 

Performance on job in discharging delegated duties. 






First 3 months. 

(Unsatisfactory later) 

.53 0-19 

1- 4 


1-2 .55 20-32 

5" 8 

3- 4 -57 33-45 



5-6 .59 46-55 


7-8 .61 56-64 



9-10 .63 65-72 


n-12 .65 73-78 


Above average 

13 .67 79-83 


14 .69 84-89 



.71 90-94 



15 -73 95-ioo 

the differentiating factors, and length of service was not con- 
sidered. This dual evaluation led to difficulties. During the 
business recession of 193 7-1 938, decreasing production necessi- 
tated many layoffs. Measured by the employee rating sheet, 
some of the best qualified college-trained service men were placed 
on the layoff list on account of their short service. To protect 
their employment, department superintendents proposed that all 
attendants be placed on the salary roll, in which case they would 


be evaluated only by the attendant's rating sheet. This proposal, 
however, would have been a formal recognition of the attendants' 
status as assistant foremen and would have meant not only an 
increase in the cost of supervision, but also the likely recurrence 
of the complaint that supervisors were burdened with errand-boy 

C. Foremen Training 

i. General Inspirational Courses. In the course of 12 years, 
the employment manager of the New Process Rubber Company 
had experience with several different kinds of foremen-training 
programs. The first type consisted of so-called inspirational 
courses that were purchased from outside agencies who specialized 
in this sort of material. At first these courses were paid for by 
the company, but experience showed that foremen did not like 
this arrangement and preferred to buy their own material. But 
even after foremen voluntarily subscribed to such courses it was 
difficult to start a class without some direct or indirect pressure 
by higher supervision. 

In some instances the institutions selling the foremen's training 
courses supplied the instructor, in others, the company furnished 
the leader out of its own ranks. Classes met outside working 
hours, generally at the close of the working day. 

This type of success material seldom succeeded in winning the 
foremen's approval. They objected that these courses dealt with 
general rather than specific problems, and they also disliked the 
form in which the material was presented. Whenever the sub- 
ject titles of the lessons depended on a clever play of words or the 
use of slogans, 1 the foremen referred to them as kindergarten 
stuff or sugar coating and lost all interest. As a result of this 
attitude many practical maxims of foremanship contained in such 
lessons were discounted. After one or two years of this kind of 
teaching, the foremen professed themselves tired of swallowing this 
stuff and asked for courses on more specific subjects. In response 
to this demand, technical courses were arranged. 

2. Lecture Courses on Specific Subjects. Technical courses on 
rubber, textiles, economics, mathematics, public speaking, and 
blueprint reading were supplied by the state department of uni- 

1 For example: " Bucking the Buckers," "Unguarded Machines and Unguarded 
Minds," " Handling Men: Five Important Qualifications," "The Two Black Crows 
(i.e., rumor peddlers)," "The Foreman: Key-man of Industry," etc. 


versity extension or directly by near-by college departments. A 
few of these courses were entirely prepared and taught by com- 
pany officials. For instance, the employment manager, Mr. 
Randall, offered a course in Practical Factory Problems, which 
was divided into (1) human problems and (2) material problems. 
In order satisfactorily to complete the course and receive a diploma, 
it was necessary to hand in all the written assignments that 
accompanied each set of problems. 

All the courses were conducted after working hours. Their 
success depended chiefly on the leaders who were in charge, but, 
on the whole, this type of program was much better received than 
the first. An analysis of the registrations indicated that the most 
popular courses were those that had a direct bearing on the 
foremen's regular duties. For instance^ one of the most popular 
was the course on Textiles, which was limited to materials actually 
used in the plant and included trips to the textile mills and dye 
shops that manufactured or processed the fabric. 

The course on Practical Factory Problems was next in popu- 
larity but met with some criticism. For the sake of brevity and 
logical presentation, the employment manager had simplified the 
problems and offered them as hypothetical cases. This separa- 
tion of human and mechanical problems from their actual setting 
proved to be a mistake. Foremen quickly realized the artificiality 
of this procedure and not only lost interest in the discussion of 
these problems but also prepared their written exercises in a 
stereotyped and copybook manner. Only the excellent text mate- 
rial, which had been prepared by the employment manager and 
printed by the company, enabled the teacher to hold the interest 
of the class. 

It became a fad among foremen to sign up for evening courses. 
But many requests came from men who were looking for a short 
cut to knowledge and who obviously thought that attending a 
course was the best way to gain favor with department heads. 
While such men were ready to listen to lectures, they showed very 
little inclination to participate in discussion or work on outside 
assignments. The employment manager concluded that the edu- 
cational activities were petering out into evening entertainments 
and convinced management that a moratorium on all foremen 
training courses should be declared. After this decision a small 
number of foremen continued to come to the employment manager 


for advice. To these men the employment manager acted as an 
informal counselor by referring them to recognized educational 
institutions for courses to suit their requirements. 

3. Development of Mixed Discussion Groups. During 1934- 
1935, there were no foremen training courses at the plant. But 
there remained a nucleus of foremen interested in intellectual 
stimulation. In response to their demands, management in 1936 
experimented with a different type of training program. A start 
was made with three groups of 12 supervisors each who met 
biweekly to discuss actual current problems and company policies. 
Foremen, supervisors, and department superintendents all par- 
ticipated in these discussion groups, which were led by the employ- 
ment manager. Each group of 12 persons represented a cross 
section of supervisors from 12 different departments. Sometimes 
problems for discussion were submitted by group members; at 
others, management assigned a topic. Especially if a change in 
company policy or regulation was contemplated, management 
asked the group members to express their opinions. No effort 
was made to obtain the unanimous approval of a group or all 
groups regarding a point under discussion. Brief minutes of each 
meeting were forwarded to management by the group secretaries. 
Since no names were mentioned, in these minutes, every member 
felt free to state his opinions without being afraid of " sticking his 
neck out." After weighing these opinions, management formu- 
lated its final policy, a statement and full explanation of which 
was given to the group leader who then conducted an informative 
meeting. It was found that this combination, discussion of a 
tentative plan followed by a formal statement of the established 
policy was more successful than inviting discussion of a policy 
at a stage when no changes were contemplated. 

In 1937 there were so many requests from supervision for a 
continuation of these mixed discussion groups that management 
decided to expand the program. Ten conference groups were set 
up with the following points in mind : 

1. To avoid emphasis on organizational status, i.e., differentiating 
groups according to the rank of participating members. 

2. To form groups that were fairly homogeneous in intellectual 

3. To avoid interference with production by not drawing too heavily 
from one department at any given time. 


The employment manager chose as leaders four other company 
officials who were approved by the vice-president in charge of 
manufacturing. Their status was as follows : 

Interviewer, mens' employment. 
Supervisor, wage and salary administration. 
Supervisor, staff training. 
Supervisor, service activities. 

Each leader had charge of two groups. The meetings were 
held on company time for a period of one hour every other week. 
On each working day of the week, therefore, one group meeting 
was held. 

To coordinate the activities of the various groups, group lead- 
ers held preliminary conferences concerning procedure and the 
subjects to be discussed. At some of these preliminary meetings, 
the leaders had the benefit of advice from Professor A. D. Sheffield, 
an outstanding authority on the leadership of discussion groups. 1 

On Dec. 7, 1937, the vice-president in charge of manufacturing 
inaugurated the new program by sending the following announce- 
ment to every supervisor in the plant. 

Re : Group Discussions 

Last season several supervisory discussion groups were con- 
ducted on an experimental basis. The experience of these groups 
proved that there is a very definite need for and interest in the type 
of supervisory meeting that discusses actual current problems and 

Requests among supervision for participation in such confer- 
ences have led to the development of a broad program this season 
that will permit all members of supervision to participate. 

You have been assigned to group No under , 

leader, and, , secretary. 

The subject for discussion at the first meeting will be "Employ- 
ment Stabilization." As you already know, management has 
attempted as far as possible to stabilize employment by scheduling 
production increases to offset production decreases in the same 
or other departments. In conformance with company policy the 
Employment Department has tried wherever possible and prac- 
tical to fill jobs by means of transfer from active employees in 
preference to hiring new employees. The success of our stabiliza- 

1 A. D. Sheffield, "Training for Group Experience: A Syllabus of Materials from 
a Laboratory Course for Group Leaders Given at Columbia University in 1927," 
The Inquiry, New York, 1929. 


tion policy is measured by our lay-off rate, which dropped from 
67.4 in 1934 to 26.5 in 1935 and to 3.1 in 1936. 

Present curtailments, however, severely test our stabilization 
structure and make the present a very opportune time to review 
and discuss the merits of the instruments and systems set up and 
now in use to maintain employment stabilization. 

It is hoped that these group discussions will facilitate a better 
understanding and a more uniform interpretation of company 
policies and systems throughout the plant. It is also anticipated 
that the groups may have suggestions or recommendations that 
will be offered to Management. 

Group No will meet regularly on: 

Place: Conference Room Opposite Payroll Cage. 

Date of first meeting: 


(s) Vice President in charge of manufacturing. 


General Statement of Peactice 

In American industry there is no uniform method of calculating 
an employee's length of service. Some companies count the 
employee's service from the most recent date of employment. 
Any interruption, no matter what its cause or duration, breaks 
the continuity of service and forces the employee to start again 
as though he were a new worker. Other companies compute ser- 
vice on department — rather than a plant-basis ; or in the case of a 
corporation with several branches and subsidiaries, consider plant 
— but not company — service. Still other concerns have special 
provisions governing loss of time caused by layoff or leave of 
absence. But even in these cases there are no generally accepted 
standards. The table, on p. 152 published by the National 
Industrial Conference Board, Inc., shows the existing diversity 
of practice. 




Table III 
Effect on Service Record if Wage Earner Is Laid Off 1 

Number of Companies, by Employees 
per establishment 

Effect of Lay-Off on Service record 







No effect 




































No definite policy 

Service record affected as follows .... 
Start as new employee 


Record broken after i month 

Record broken after 2 months 

Record broken after 3 months 

Record broken after 6 months 

Record broken after 1 year 

Record broken after 2 years 

Record not broken, if employee 





None, except time out deducted . . . 
Loss of vacation rights 


Loss of bonus payments 

Varies ace. to length of service. . . . 









Per cent of companies 

No effect 


1 . 1 






1 . 2 







1 . 1 



No definite policy 

Service record affected as follows 

Record broken after 1 month 



21 . 1 

Record broken after 2 months 

Record broken after 3 months 

Record broken after 6 months 

Record broken after 1 year 

Record broken after 2 years 

Record not broken if employee 


2. 1 




1 . 1 

1 . 1 






None, except time out deducted . . . 
Loss of vacation rights 


Loss of bonus payments 

Varies ace. to length of service. . . . 









1 National Industrial Conference Board Studies, 233, Personnel Practices Governing Factory 
and O^tice Administration, New York, 1037, p. 78. 

Case 25. Method of Computing Length of Service 

of Factory Employees at the New Process 

Rubber Company, Inc. 

Up to 1 93 1, employees of the New Process Rubber Company 
who were laid off because of decreased production 1 were granted 
the following continuous-service provisions in the event of their 
reemployment: Continuous-service allowances were based upon 
the length of previous continuous employment and the length of 
time elapsed between layoff and reemployment. 

Continuous-service Allowances 

Previous Continuous If Rehired within the Following 

Employment, Years Period, Months 

i-3 3 

3-5 4 

5-7 5 

7 and over 6 

For example, John Kennedy, who had six years of service, was 
laid off on Oct. 26, 1928. He remained unemployed until Mar. 
13, 1929, at which time he was rehired. According to the pro- 
vision, he had a continuous-service allowance of five months. 
Since he was reemployed within this limit, John Kennedy quali- 
fied for continuous employment and could claim a continuous 
service of six years and five months, regardless of the fact that 
he did not work for the company during the last five months. 

During the 1931 depression, many layoffs extended beyond 
the specified rehiring limits, thereby depriving employees of pre- 
vious service credit. 

In 1933, the increased business activity that developed in 
anticipation of the National Industrial Recovery Act with its 
compulsory codes, led to temporary rehiring. In numerous 
instances the layoff period of these rehired employees had exceeded 
the above limits and in consequence they had lost their rights to 
continuous-service credit. These employees protested through 
their union representatives, since this loss of service affected their 

1 Voluntary quit and discharge for cause automatically broke an employee's 
service record. 

1 S3 


employment status. After a sufficient number of such cases had 
been brought to the attention of the union officials, they petitioned 
management to establish a more liberal policy than the current 
one. In response to this request, management introduced a new 
policy early in 1934, which was made retroactive to Jan. 1, 1931. 
The new schedule granted the following more liberal allowances: 

Revised Schedule of Continuous-service Allowances 

Previous Continuous If Rehired within the Following 

Employment, Years Period, Months 

o-3 3 

3-5 6 

5 and over 12 

Continuous-service allowances for long-service employees were 
doubled under the new schedule. This increase satisfactorily 
adjusted many complaints. There were a few cases, however, 
in which employee layoff exceeded even these limits. The union 
officials, therefore, demanded an even more liberal continuous-serv- 
ice allowance, specifying as a maximum two years for employees 
who had five years or more of service. This would mean that 
an employee with five years of service might be unemployed for 
as much as two years and then return to work with seven years 
of continuous service to his credit. Employees who had never 
been laid off objected to this proposal. They said in effect: "We 
have been working for the company without interruption while 
others who have been laid off once or twice get just as much 
service credit as we. That's not fair." 1 Management sympa- 
thized with this point of view and declined to extend the con- 
tinuous-service allowance beyond 12 months, fully aware that no 
matter where the limit might be drawn there would always be a 
few cases that remained outside this limit. 

In the months that followed, the union officials repeatedly 
requested management to reconsider the question of continuous- 
service allowance. Even though this topic was discussed at each 
succeeding meeting between management and the union, no 
mutual agreement was reached. 

Finally on May 17, 1937, the employment manager suggested 
the following solution of the continuous-service problem. Serv- 
ice should be figured as cumulative rather than continuous. An 

1 Implicit in their protest was the assumption that an employee who was not 
laid ofl was of greater value to the company than one whose service was dispensed 
with as soon as production dropped. 


employee's service should be computed on the basis of actual 
working time with the company excluding any layoff, voluntary 
absence, and discharge. This suggestion was acceptable to the 
union. Management, however, regarded it at first as too radical 
a change since such a policy made no distinction between an 
employee who was laid off for no fault of his own and one who had 
been discharged for cause or who had left the company without 
notice. The employment manager met this objection by arguing 
that if the company saw fit to reemploy such an individual, they 
should be willing to give him full credit for any previous service 
he might have. After several discussions, this point of view pre- 
vailed, and the policy governing length of service was rewritten 
as follows : 

Length or Service Provisions 

Length of service for employees of the company will be determined 
according to a plan which provides that: 

1. Lay-off time will not be included in accumulating total service. 

2. Total service will be accumulated on the basis of actual time 
periods of employment with the company, subject to the follow- 
ing exception: 

a. No service credit will be allowed until a probationary period 
of one year of continuous service has elapsed. Service credit 
will then be accumulated from the date on which employment 
began, including any short periods of less than one year that 
may have preceded the probationary year. 

3. Employees who have attained one year of continuous service will 
never lose credit for previous service in the computation of any 
future service, regardless of intervening loss of employment for 
any cause. 

4. Special provisions regarding sickness, non-industrial injury, 
pregnancy and leave of absence. 

a. In cases of sickness, non-industrial injury, or pregnancy, 
service will be discontinued only after three months of absence. 

b. Leave of absence for World War Service or similar service 
in the future in the armed forces of the United States will be 
allowed as continuous employment with the company. 

c. Any other leave of absence will receive special consideration 
based upon the circumstances in the individual case before 
allowance will be made. 

5. Method of adoption and effective date. 

a. New Accumulative Service Provisions will be used to determine 
all vacation allowances for the year 1938. 

b. Any lay-offs scheduled to occur after the summer shut-down 
or any employee evaluations recorded after that time will be 


made in accordance with the new accumulated service 

c. Past service of all active employees will be accumulated in 

d. The service credit in each case will be mathematically accu- 
mulated and recorded on a Service Record Card, in years, 
months, and days, up to January i, 1938 and thereafter 
recorded at the beginning of the year. For purposes of com- 
putation all months will be considered as having 30 days. 
Within any calendar year the employment department will 
accurately determine service credit for the purpose of employee 
evaluation by adding actual time worked in the current year 
to service credit recorded at the beginning of the year. 

6. Upon re-employment, all former employees will have past 
service accumulated on the above basis. Eligibility for vacation 
will be established only in the event that re-hiring occurs prior 
to the summer shut-down. 

Case 26. Marie Kusacz 

(Relation between sickness absence and length of service. Other aspects.) 

Characters : 

Mr. Daley, union representative. 
Miss Kusacz, former employee. 

Mr. Randall, employment manager at the New Process Rubber 

On Friday, Apr. 8, 1938, Jack Daley came to see Mr. Randall. 
Daley was excited and, without further preliminaries, marched 
into the employment manager's office, saying: "It isn't fair and 
I'm not going to stand for it!" 

"What isn't fair"? asked the employment manager. 

Daley: The way you're treating Marie Kusacz. Here's a girl that's 
been out six months with a serious operation, and now, when she's 
ready to come back to work, your Mr. Brown won't hire her back. 
Why was she canceled in the first place? That's what I'd like to 
know. It's not fair to cancel a girl when she's out sick — anyway, 
not a girl that's been here ten years; and she owes a lot of money. 
She owes me some. I lent it to her so she could have the opera- 
tion. Her husband isn't working and she has to support her 

Randall: Well, now, just a minute, Jack. One thing at a time. I 
didn't know Marie was able to come back to work. 

Daley: Sure she's able. Her own doctor says so, and she went to 
Dr. Davies (Company Doctor) this afternoon and he says so, 
too. She's O.K. Then she went to her own department to see 
her foreman (Mr. Cross) and he said he'd be glad to take her back 
on her old job, but she'd have to come to the employment office 
first. So I just brought her over to see Mr. Brown, and he won't 
sign the slip. I told him that wasn't fair and he said I'd better 
talk to you. 

Randall: Did Mr. Brown explain to you why he couldn't hire Marie? 

Daley: Yes he did, and that's the worst part of it. He says Marie 
can't come in on Friday and expect to go to work Monday. Then 
he says he's filled every job for Monday by transferring girls from 
other departments, and I'll bet you anything some of the girls 
he's after transferring have only been here a couple of years. 
Marie's been here ten years. I ask you, is that fair? 



Randall: Well, Jack, you know how hard we try to protect the 
employment of all the girls who are working here. We listed that 
work in winter footwear ahead of the regular schedule in order to 
provide work for girls who would otherwise be laid off from summer 
footwear departments. We had to prepare for this two weeks ago. 
The transfers are all completed and the girls have been told to 
report for work Monday. Now, if we should place Marie on such 
short notice we'd have to displace one of those girls, and we couldn't 
lay her off without giving her a week's notice. You remember we 
agreed to that. 

Daley: Aw! you don't need to lay her off. Find her a job somewhere 

Randall: That's not so easy with our decreasing production, Jack. 
We've shifted more than fifty girls and^even laid off four to arrange 
our schedule for next Monday. 

Daley: Well, that's a hell of a note. You keep a girl on who's prob- 
ably only been here about a year, and you keep out the girl that's 
been here ten years. 

Randall: Let's get down to facts, Jack. Consider the agreement we 
made on sickness absences. We agreed that persons excused 
because of illness would have their standing as employees of this 
company protected up to a maximum of three months of continuous 
absence. We agreed also that any such person applying for rein- 
statement within three months would be returned to work within 
seven days. It was also stated that persons absent because of 
illness for more than three months would cease to be employees 
of the company, but would be eligible for reemployment just like 
any other former employee of good standing. Marie's been out 
six months, and you are asking us to take her back on the next 
working day following her application. We can't do that. How- 
ever, we most certainly will take her back within the year so 
she'll have an unbroken service record. Under the ruling I've 
just stated we're not obliged to hire Marie at all, but I am promis- 
ing you that we will hire her because she's had a very good record, 
and we want her back. I can't tell you to a day when she can 
start until I know what arrangements can be made. 

Daley: Well, I don't call that fair. You should forget the ruling in a 
case like this and take Marie back right away. It wasn't her 
fault she was sick. She's been put to a lot of expense, and she 
needs the money to pay her bills. She's given this company ten 
years of faithful service and when her own foreman wants her 
back and is willing to take her back right away, I don't see what 
right you have to refuse her. 

Randall: But, Jack, we're not refusing to hire her. 

Daley: Oh, you can't fool me. That's the old stall. You'll keep 
putting her off, and then you'll find some reason not to hire her 
at all. 


Randall: As a matter of fact, Jack, it's you who are not being fair. 
According to the rules we are not obliged to rehire any person who 
has been out for more than three months. But Marie has a good 
record, and I've told you we shall rehire her as soon as it can be 

Daley: You admit she's got a good record. You admit she should be 
rehired. Then why don't you do it? D'you mean to tell me that 
in a company as large as this one, you can't find a job for just 
one girl? 

Randall: Jack, out of more than four thousand girls listed in our 
application files, a great many have asked me that same question. 
Our applications at present exceed the total number of girls 
employed here. Obviously we can't find jobs for all of them. 
We hire them only as jobs open up. Otherwise we must displace 
somebody already employed. We haven't had an opening for 
even one girl for more than three months now. But I am very 
hopeful that we can place Marie within a few weeks. 

Daley: Are you sure you can find a job for her in that time? 

Randall: No, I'm not sure, Jack. Something might happen to delay 

Daley: That's just what I thought. . . . Say, have we got any rule 
against hiring married women? 

Randall: No, we haven't. You know that. Over 30 per cent of our 
girls are married. 

Daley: All right, then. Let's come to the point. Mr. Brown is 
putting a young girl on Marie's job. That's what gets my goat. 
How does he get away with that? 

Randall: Why do you call this particular job, Marie's job? 1 

Daley: Well, that was the one she was working at when she took sick, 
wasn't it? 

Randall: That's true, Jack. But she's worked on at least a dozen 
other jobs. We can't consider that any one particular job neces- 
sarily belongs to Marie or to anybody else. Our entire program of 
employment stabilization would fall flat if we couldn't shift girls 
about. When production drops in one department we must lay 
people off if we can't transfer them. That's what we used to do 
years ago. You don't want to go back to that, do you? 

Daley: No, of course not. Stabilization is O.K. But what am I going 
to tell Marie? I told her I'd get her job back for her right away. 
I'm her representative, don't you know, and got to look after 

Randall: I understand that, Jack. But you're not letting her down. 
I've already told you that we'll hire her back. It's just a question 
of finding out exactly when we can do it. I think we can decide 
that some time early next week. Marie will be reasonable about 
it once she's sure she's coming back. Where is she now? 

1 For the last two seasons, Marie had worked on conveyor 15 making overshoe 


Daley: She's right here in the waiting room. 

Randall: Oh well, then, why don't you ask her to come in so we can 

talk it over together? 
Daley: O.K. 

The union representative went out and brought Marie into 
Mr. Randall's office. 

Marie: Hello, Mr. Randall. 

Randall: Hello, Marie. Glad to see you. Come and sit in that 

Marie: Thank you. 

Randall: You're looking well . . . and that's a pretty dress you 
have on. 

Marie: Yes, my mother gave it to me when I came out of the hospital. 
It gives you "that lift" you know. I'm fine now. 

Randall: Well, that's great. Jack, here, tells me you're very anxious 
to get back to work. 

Marie: You bet I am, and John (foreman) wants me, too. I think it 
was kinda mean of Mr. Brown not to let me have my job. But I 
told Jack I knew you'd let me have it. 

Randall: Mr. Brown will be glad to arrange for you to come back, 
Marie. He wants you back just as much as I do, but, of course, 
he's got to think about the other girls, too. He has to be fair to all 
of you. And I know you wouldn't want to throw anybody out of 
a job if you can prevent it by waiting a few days. 

Marie: Me? Oh no! ... I wouldn't mind waiting a few days as 
long as I know I'm coming back. I was afraid maybe I couldn't 
get back at all. And, gee! you know what hospitals and doctors 
cost. I owe a lot of money. Besides the doctor, I owe Jack here 
ten dollars and I haven't paid mother anything for quite a while. 

Randall: Are you supporting your mother, Marie? 

Marie: Well, no, not exactly. But we live in her house. We try to 
pay her something, like rent, you know. But lately we haven't 
paid her anything. And it costs a lot to own a house, you know. 
The trouble is that Fred, (he's my husband, you know) is only 
working three days a week now. They don't do much in the 
upholstery business during the summer, and they only call him 
when they have work. I wish he could get a job here where it 
would be steady. 

Randall: I'll tell you what we'll do, Marie. I'll talk this over with 
Mr. Brown and find out how soon he can get you back to work. 
As soon as he finds out, he'll send you a letter, and I'll ask him to 
send you a copy, too, Jack. 

Marie: Oh gee! Thanks, Mr. Randall. That'll be swell. . . . Can I 
go back to John's department? I know all the jobs there. John 
gave me ioo per cent on versatility. 


Randall: Yes, I know, Marie. I don't think we'll have any trouble 
getting you into John's department. We'll put you on the next 
conveyor that's listed. That'll probably be inside of two weeks. 
We'll let you know definitely as soon as we can find out. 

Marie: That's O.K., and thanks again, Mr. Randall, and you, too, 
Jack. Good bye, now. I'll be waiting to hear from you. 

Randall: Good bye, Marie. 

(To the union representative) Well, I guess that settles that. 
Anything else on your mind, Jack? 

Daley: No thanks. . . . See you later. 

Randall: So long. 


Case 27. Wage Rates of Electricians in the 

Maintenance Department of the 

National Manufacturing Company, Inc. 


Mr. Cameron, president of the union. 

Mr. Jones, first-class electrician and union representative. 

Mr. McCarty, first-class electrician. 

Mr. Dickson, general foreman, maintenance department. 

Mr. Avery, supervisor, industrial relations. 

On June 2, 1937, Mr. Cameron brought Mr. Jones and Mr. 
McCarty into Mr. Avery's office : 

Cameron: Mr. Avery, I brought over Mr. McCarty and Mr. Jones from 
the electrical department to have them tell you their story them- 
selves, as they know more about their own craft than I do. 
(To Mr. Jones) Mr. Jones, suppose you tell the story to Mr. Avery. 

Jones : Well, we feel that the electricians ought to be rated higher than 
they are. 

Avery: What do you mean by that, Jones? We rate our electricians 
pretty high. 

Jones: Well, I mean that their brackets ought to be higher than they 
are now. 

Avery: What you are asking for is a raise for electricians, is that right? 

Jones: Yes, I think we ought to get a raise. 

Cameron : These fellows feel that the electricians should be rated higher, 
in other words, have a higher bracket than other crafts in the 
maintenance department, such as pipers, welders, millwrights, etc. 
Right now they are all rated alike. 

Avery: What makes you feel that electricians should be rated higher 
than the other maintenance men? 

McCarty: Well, we have more responsibility. The millwrights can't 
do our work but I can do a millwright's job any day. Here's 
another thing, I have to go out and get a license in order to be a- 
first-class man. I have to take an examination in order to get 
my license from the state. The millwrights just go to work. 

Avery: I am inclined to agree with you, McCarty, that electricians 
have to satisfy more exacting requirements. On the other hand, 
you're asking me to break up something that has been a custom 
and an established rule for some time. If you will look at our 



wage scales you will see that we have always treated the crafts 
alike. That is, a first-class piper, a first-class welder, and a first- 
class electrician have been rated the same in our plant. 

McCarty: Well, we feel we ought to get as much as machine repair 
men and the fitters up in Department Z. 

Avery: Let me understand you fellows clearly. If you want to talk 
about the whole plant that's a different story. We just gave a 
general wage increase two months ago and we don't feel like going 
into any more haggling about individual brackets, as this matter 
was brought up during the negotiation on our last wage increase. 
I suggested at that time that we had a fine opportunity before 
us to straighten out some of the wage irregularities in our plant. 
But I was turned down flat by the negotiating committee in favor 
of giving all employees an equal raise. 

Jones: Well, Avery, it's always been recognized that a first-class 
electrician rates more than other crafts in maintenance work, 
and I don't see where it would cause any trouble if we got a raise. 

Avery: I have already told you that in my estimation electricians 
should rate higher than other crafts. On the other hand, I can't 
get away from the fact that I must think of the plant as a whole. 
And I'm not going to do anything to satisfy one particular group 
that might bring other groups down on my neck. 

McCarty: Well, how about thinking it over? 

Cameron: I think if you will look into this, Avery, and give this 
question some thought, we might be able to work out something 
at another meeting. 

Avery: Well, I don't want to make any snap judgments and perhaps 
it is better if I sleep on this a little. On the other hand, I do 
want to remind you fellows of the possibility that I've already 
mentioned and the fact that if everyone had cooperated in this 
matter we could have taken care of this situation during our recent 

Cameron: Well, suppose we give you a week to look into this and 
then have another meeting? 

Avery: O.K. 

On Friday June 4, 1937, the industrial relations supervisor 
interviewed Mr. Dickson, the general foreman of the maintenance 

Avery: I had some of your boys up to see me the other day, George, 
some electricians. They feel that they ought to get more money 
than the other occupations in the maintenance department. 
What is your slant on that? 

Dickson: Well, Jim, I think some of them ought to get more money. 
I got a few, real first-class men, that I would like to give a raise. 
But I hesitate to ask you to allow me to make special rates above 
the established bracket for these men when I know that the rest 


of them will come hollering and want to know why they can't 
get this rate, too. 

Avery: Do you think we ought to evaluate the job of electrician in 
our plant higher than first-class men in other crafts such as your 
steam fitters, your welders, or your millwrights? 

Dickson: No, I don't. I like to be able to pay a first-class man in any of 
the crafts the same rate. This has been an established custom in 
our wage schedule, and I don't think that we'll be able to get away 
with increasing one bracket for one craft without having trouble 
with the other crafts. We've always recognized that a first-class 
steam-fitter, a first-class welder, a first-class electrician, in fact, 
a first-class man in any craft should be rated alike. That is why 
our wage schedule is set up as it is. 

Avery: I need some information on this question and want to discuss 
this further when you have more time. Meanwhile, I should be 
obliged if you would look into this and some time later, at your 
convenience, come into my office. I should like, if you could 
find the time, to have your definition of a first-class electrician, 
keeping in mind the work that he has to do in our plant. I 
should also like a list of the men whom you consider to be first- 
class men. Understand, I don't want the names of those who 
are listed as first-class men through a wage increase or some other 
factor. I am only interested in the names of those men whom 
you really regard as first-class men on account of their training, 
experience, and ability; men that you can depend upon to do 
first-class work and whom you would wish to pay top money. 

Dickson: I'll be glad to do that, Jim. 

A few days later, Monday, June 14, 1937, Mr. Dickson came 
into Avery's office and submitted the following information: 

Definition of First Class Electrician 

Ability to perform the highest type of electrical work such as: 
installation of new equipment, re-vamping, or re-locating old equip- 
ment, running power lines in buildings and under ground, installation 
of machine tools, testing equipment, lighting, and so on: or responsi- 
bility of answering trouble calls that come into the electrical depart- 
ment in the replacement of fuses, trouble shooting and inspection; 
or repairing of electrical fractional horse power motors, electric drills, 
and portable tools. Also assume the responsibility for a helper or 
helpers who work with a first-class man ordinarily. 

Names of men who can do this work 


The following is part of the conversation that ensued : 

Dickson: I feel, Jim, that if you were going to agree to any changes 
in brackets that we ought to come to an understanding with the 
men as to what the duties in the various classifications are. I 
believe that the five men whom I have listed as real first-class 
electricians should get more money than our present bracket 
allows. On the other hand, I don't want to make a bracket that 
would allow every one of the 22 men who are now listed as first- 
class electricians to fall into it. 

Avery: I am glad to get your slant on this thing, George. Those are 
my sentiments exactly. But to tell the truth, I don't feel like 
doing anything about this whole question for the present in view 
of the fact that we're paying the prevailing rates in the com- 
munity for similar work and we've just had a general wage increase. 
During the negotiations I specifically pointed out the inequalities 
in the rates of the maintenance men and asked for cooperation 
to straighten them out. We told this group that we were willing 
to pay more money for certain occupations if we could get the 
cooperation of the committee in the evaluation of the work. In 
other words, we made it clear that we only wanted to consider 
men who were really qualified according to ability, training, and 

On June 30, 1937, the industrial relations supervisor called a 
meeting at which the following men were present : 

Mr. Cameron. 
Mr. Jones. 
Mr. McCarty. 
Mr. Dickson 
Mr. Avery. 

Avery: Well, gentlemen, I've gone into the matter of your request and 
hope that you fellows have given some thought to it also. My 
first thought in this matter was to find out, if possible, what 
other companies did in the matter of evaluation between one 
craft and another. I did this in two ways : 

First, by contacting different men in different plants and asking 
the question: "Do you feel there should be any difference in rating 
between a first-class electrician and any other first-class men in 
maintenance crafts?" 

I found that all of them (some 25 companies were represented) 
stated that there was no difference. That if a man was a first-class 
man and did first-class work he was paid accordingly, regardless of 
his craft. 

My second check consisted of a survey of some 300 craftsmen and 
their wage rates. I found that there was fit tie or no difference 


between the various crafts. That is, I didn't find a great deal of 
difference between the average earnings of first-class electricians, 
pipers, tinsmiths, millwrights, welders, or carpenters. I did find, 
however, that different plants were paying higher rates to excep- 
tional people. I also found that considering such occupations 
as painters, oilers, and beltmen, we are paying them more than 
they're getting in other plants. This means in a sense that we are 
probably paying more money than we should for these occupations. 
Another thing that I looked into which is interesting is the recent 
agreement between the building-trades union and the building- 
trades contractors. The rates of pay here indicated that with 
the exception of masons, other crafts in work similar to ours 
were getting the same rates of pay. 

Cameron: Well, of course, we're not interested in the building trades. 
That's an A.F. of L. crowd. 

Avery: I merely mention it to show the extent to which I've gone into 
the problem to find an answer to your request. Regardless of 
who it is, it does show at least a change in thinking over the past 
few years with regard to evaluation of rates of pay for different 
crafts. You will recall that in the building trades the electricians 
were always considered top and in the highest three. 

Jones: Well, the building- trades rate for electricians is $1.37^ an hour. 
Our top rate is only 90 cents. 

Avery: True, but remember your work is steady during 12 months of 
the year, while the building tradesman has work only when he 
can get it on a particular project. 

McCarty: Mr. Dickson, don't you honestly feel, (you know the 
fellows), don't you feel that electricians ought to get more money? 

Dickson: I'll say this, McCarty: There are some of you men that I 
would like to give more money to. But I'm handicapped due to 
the fact that we're paying more money as a whole in our main- 
tenance department than we should. There are five men in our 
department that we ought to pay first-class money to. And 
you know as well as I do who they are. But I don't feel like 
raising some 17 others that are not really first-class men. 

Cameron: Well, I can tell you one thing, we don't intend to lower any 
rates for the sake of giving a few a raise. 

Avery: I think that is unnecessarily said, Mark. We have never 
lowered any rates, and we don't intend to do so now. The 
only thing that we do want to bring out is that we are not giving 
our money where it ought to be given in recognition of ability 
and quality of work done. We've done too much about trying 
to get a man rated as a first-class man in order to get a raise for 

^ him regardless of the fact whether or not he really did first-class 

1^ work. I want to show you here a couple of charts which show 

^ , what I mean. In the first chart you see the present condition 

bJ of our organization, 22 men are listed as tops, or first-class men. 
We don't have that much first-class work around here in the first 



place. Only 4 men are listed as second-class men; and 9 of 
them are helpers. Obviously this organizational setup is wrong. 
We've got more captains than we've got privates. 




Chart X. — Classification of electricians in the maintenance department, National 
Manufacturing Company, Inc. 

Our second chart shows what the organization ought to be 
according to a strict interpretation of labor grade. There are 





Chart XI. — Classification of electricians in the maintenance department, 
National Manufacturing Company, Inc., according to a strict interpretation of 
labor grade. 

five men who actually do first-class work. Ten men are doing 
second-class work; while 20 men should be classified as helpers. 

McCarty: Well, why not give the first five men a raise? 

Avery: Mr. Dickson has already told you why we cannot do that, and 
I would not consider breaking any brackets at this time which 
would disturb the whole maintenance department. I would like 
to change the organization on the basis of a strict job evaluation, 
and the second chart shows you what I would like to see. Now 
this is the very thing we tried to do in our last negotiation but 
were not able to do because you men would not give us your 

Cameron: It seems that you're blaming everything on the union. 

Avery: I'm only stating facts, Mr. Cameron. You will recall that this 
was discussed in our last negotiation. We are still maintaining our 
policy of paying the prevailing rate in this community and that 
doesn't mean that we're matching every wage that the other 
fellow is paying. It is possible that you can show me a man here 
and there who is getting more money but you will agree that in 
such cases we're dealing with exceptional men in their class. 

Cameron: Well, is this final? Is there no more to talk about? How 
about asking the manager what he thinks? 

Avery: I am stating the manager's views on this. People in the com- 
munity are giving increases to match our wages. It doesn't hap- 
pen to be the reverse this time. I'm sorry that I can't do anything 



for you people but I don't expect to make a home run every time I 
go to bat. This is one time apparently that I'm not making a 
home run. The time may come when we can get together on this 
matter. But it is certainly not at present. 

McCarty: Well, it's quite evident to me that skill and ability don't 
mean much under this present setup. I don't know who is 
responsible for it, but I think it's a damn shame. 

Cameron: I think we'd better adjourn and I'll see about taking it up 
later with the manager. 

The following chart shows the rate structure among electricians 
in the maintenance department. A gives the distribution of the 
members in the various classes. B presents the same distribution 
but in addition, shows each man's chronological age and length 
of service with the company in years. 

First class 

Electrician's . 

Hourly rate, 

la C 



1 1st. Shift 
2nd - 
13 rd. •• 


1 1 1 1 1 TT 


[E Hourly rated foremen 
E3 Group leader 
US Special rate 

H First class electricians 
listed in chart JSI 

85 + 




Electrician, 69 ; : 69 
Second class - • 

61 - -61 



^Electrician: first class 
■ Electrician -.second class 
G2 Electrician's helpers 


I8V 2 

36 31 

31 37 38 43 37 3711 32 41 41 49 37 

i 1 111 rri 1 1 1 1 1 

W\ II 8'/ 2 l7l4j.l0^8 4 \\ 8 \\ |p£ 

37 37 4? 32 44 27 

Ml I I I I 

15 8 n 4 I 8 3V 2 \\ 
45 22 33 

a ho 

9 3^9 


23 2S 33 26 21 21 24 35 36 


Vl z 3 \'b&\l\ I I 8'/ 4 4 

31 age, years 
8 3 / 4 company service.years 

Chart XII. — Wage rates of electricians in the maintenance department, National 
Manufacturing Company, Inc. 

Case 28. Salary Allowance during Absence 

(Policy at the New Process Rubber Company, Inc.) 

During the spring of 1937, when the state unemployment com- 
mission was formulating the state unemployment compensation 
laws, the management of the New Process Rubber Company 
thought it advisable to establish an accurate attendance record for 
all employees. It was thought that such a record would be 
needed to establish the amount of compensation to which an 
unemployed person might eventually be entitled. This decision 
led to an examination of the company's attendance records, which 
disclosed the fact that absence among the clerical force was not 
being accurately recorded. It was the duty of the clerical pay- 
roll paymaster to maintain such records. When confronted with 
the criticism that the records were inadequate, he complained 
that many department heads were not cooperating sufficiently 
to enable him to keep an accurate record of all absences. For 
instance, many department heads were not reporting short 
absences at all and merely reported absences of extended duration. 
This complaint led to a review of the system outlining the com- 
pany policy for payment of salary during periods of absence. 
The policy was as follows : 

Clerical employees who are absent due to sickness or disability 
(nonindustrial) may receive their salary in accordance with length of 
service as follows: 

Length of Service, Years 
6 months to i year 


:'s Salary 









5 and over 


Whenever a case of individual absence exceeds the above limit, the 
department head shall report the case to the treasurer for review. If 
circumstances so warrant the treasurer may extend payment of salary 
for a longer period but will otherwise notify the paymaster to suspend 
salary until the employee returns to work. 



It was the duty of the plant auditor to formulate and keep 
up to date all company systems. The treasurer, therefore, 
instructed Mr. Blake, the auditor, to interview several department 
heads and find out whether they were uniformly adhering to the 

Mr. Blake went first to Mr. L. D. Richy, who he had reason 
to believe was not reporting short absences among his clerks. 
The following is not a report of the entire conversation but merely 
a digest of statements pertinent to the case. 

Characters : 

Mr. Blake, plant auditor. 

Mr. Richy, superintendent of the mechanical-goods department. 
Mr. Sherwin, superintendent of raw material and office supplies. 
Mr. Black, manager of the accounting department. 

Blake: I am checking up on our system as it relates to clerical absence. 
Do you report every clerical absence that occurs in your department? 

Richy: No, I never report it if a girl loses only one day, but I do if she 
loses several days in a row. 

Blake: Why do you make that distinction? 

Richy: I am merely following the system. If she loses only one day 
she is paid for it anyway, so why report it? If she is out several 
days, however, I always send it through on the weekly attendance 
report in case she may run beyond her quota for salary allowance 
according to the system. 

Blake: According to your interpretation of the system, the suspension 
of salary allowance for sickness applies only when the time limit is 
exceeded in one period of continuous absence, is that right? 

Richy: That is correct. 

Blake : Well, that is not my interpretation. I have always understood 
that the limit applied to an accumulation of all absences through- 
out the year, short or long. 

Richy: I never got that slant on it. 

Blake: According to your arrangement you place no penalty at all on 
the girl who is a chronic short-time absentee and loses a few days 
each month. 

Richy: I consider that a matter for supervision to look after. Under 
proper supervision no clerk should stay out unnecessarily and no 
sick girl should be allowed to work. And I can tell you right now, 
that's the way it works in my department. We don't have any 
chronic absentees. - 

Mr. Blake then called upon Mr. Sherwin and asked him whether 
he was reporting every absence among his clerks. 


Sherwin: Yes, I keep a record of all lost time and accumulate it for 
each girl throughout the calendar year. It's very seldom that a 
girl exceeds the limit under the system. . If she does, I always take 
it up with the treasurer. 

Blake: Good, That's exactly according to the system as I interpret it. 

Mr. Blake then called upon Mr. Black, in charge of a large 
number of clerks. In answer to his question regarding clerical 
absences he received still a different answer: 

Black: I follow the system to the letter, except for half days. I run a 
sort of debit and credit system for half days, but any lost time of a 
full day or more goes on the absence record and is charged against 
the employee for the next 12 months. 

Blake: You mean for the calendar year, don't you? 

Black: Oh no, not on a calendar-year basis. I keep an accumulation 
of the past 12 months ending on the current date. It's much 
fairer than the calendar year. Your calendar-year arrangement 
may wash off an accumulation of absence for November and 
December and give the employee a clean slate on Jan. 1. Under 
the continuous 12-months' plan, an absence will always be charged 
against an employee and added to any other absences for the 
current 12 months. 

Blake : That's a new one, but I see your point of view. And how about 
this half -day debit and credit business? 

Black: As you know, the volume of work fluctuates during the month, 
causing some overtime. If a girl loses half a day, I charge it 
against her as a debit until she works enough credit through over- 
time to cancel it. In the same way, if a girl has not lost any time, 
and I ask her to work overtime I credit this extra time to her and 
allow her to take an equivalent amount of time off when we are 
not rushed. 

Further investigation by Mr. Blake convinced him that almost 
every department head had a different idea as to the meaning of 
the system. He concluded that the company's policy on clerical 
absence would have to be stated much more specifically than the 
current policy was written. He reported his findings to the 
auditor and at the latter's suggestion set out to rewrite the policy. 
In this work he was assisted by Mr. Black, manager, accounting . 
department, and Mr. Harvey, supervisor, pay-roll department. 

The policy as rewritten provided that all lost time of one-half 
day or more should be recorded daily, classified according to 
reasons, and reported to the office manager. The following sym- 
bols were to be used to indicate different types of absence: 



S Sickness 

I A Industrial accident 

NIA Nonindustrial accident 

OR Other reasons: i.e., death in family, sickness at home, 

funerals, personal business, etc. 

It was further provided that any time lost for reasons other 
than personal sickness or disability should be paid only with the 
approval of the treasurer. 

The new system provided that the office manager should main- 
tain a complete record of all clerical absences accumulated daily 
for the 12 months ending on the current date. The following 
form was proposed for this purpose : 

Note: All unpaid absences should be encircled to identify them, in order to avoid 'their being charged 'against 
the employees lost time salary allowance 
Chart XIII. — Sickness absence, New Process Rubber Company, Inc. 

The purpose of this record was to limit payment of salary 

during disability on the following basis : 

Week's Salary, 

Employed Up To Allowed 

6 months o 

6 months to i year i (5 days) 

1 year to 2 years 2 (10 days) 

2 to 3 years 3 (15 days) 

3 to 4 years 4 (20 days) 

4 to 5 years 5 (25 days) 

5 to 10 years 6 (30 days) 

10 years and over 6 plus 1 

day's salary for each year of service above 10. 

The record sheet permitted entries to be made for a period of 
13 months. This was to allow computation for any date between 
the first and the last of the month. However, reference to absences 
in the first month of the 12-month period necessitated a check 
back to the daily record for that month. 


Mr. Blake selected two actual cases of extended absences to 
illustrate how the new record system would work. 

1. Example of Helen Howe. Miss Howe's record shows that 
she had lost 29 days during the 12 months preceding September, 
1937. She had received her salary during all this lost time because 
with a service record of five years she was entitled to 30 days' 
sickness allowance in any 12-month period. 

Under the old system, she would have received salary for her 
absence on Sept. 10, 1937. However, in checking back to Sep- 
tember, 1936, it appeared that the 10 days lost in that month 
occurred during the last two weeks of the month. Therefore, her 
absence on Sept. 7, 1937 constituted the thirtieth day of absence 
in the current 12 months' period. For this reason, under the new 
system, she would not be entitled to receive pay for her absences 
on Sept. 10 and 13, respectively. However, she would be paid 
for her absences on Sept. 17 and 20, because she would begin to 
regain sickness absence credit on Sept. 17. 

2. Example of Dorothy Bryan. Dorothy Bryan had a service 
record of four years and so would be entitled to 20 days' sickness 
allowance in any 12 months. Hence she would be paid for all 
absence shown on the record up to Sept. 22 and 23. 

After reviewing the new policy, the employment manager 
called a meeting of major plant executives from factory and office 
to discuss its merits. He asked Mr. Blake to present the policy 
to the group. Mr. Blake outlined the proposed policy and the 
record system provided for its administration. He pointed out 
the following advantages: 

1. This plan sets up a system that is obviously more fair to the 
employees than the calendar-year system. Under the calendar-year 
plan it would be possible for an employee to receive salary for six weeks 
of lost time in November and December and then immediately receive 
six weeks more allowance in January and February of the following year 
or a total of twelve weeks for one continuous absence. The only way 
to avoid this contingency under a calendar-year arrangement would be 
to allow not more than six weeks for any one continuous absence. 
This would mean, however, that a person might return to work for a 
short time in January and again become eligible for six more weeks. 
This would obviously be unfair to the person who was deprived 
of the second six weeks because of twelve continuous weeks of 

2. Under the proposed twelve months' plan, an absence of six 
weeks would not wash off the record until twelve months hence, regard- 


less of the time of year in which the absence occurred. This plan, 
therefore, places a penalty on the chronic absentee, which is exactly 
what we want to accomplish. 

3. Furthermore, since past absences do not wash off the record at 
the close of the year, it actually costs the company less money for 
sickness absence. 

4. In addition, it "gets the chiseler" who would take advantage of 
a calendar-year schedule by staying out toward the end of the year, 
knowing that the absences will wash off the record when the new 
year starts. 

5. Our old policy was set up rather indefinitely for the guidance of 
management and was susceptible to a wide variety of interpretations, 
which resulted in considerable inequality in the allowance to different 
employees. Today, our clerical employees are unionized and will, 
therefore, make comparisons between cases and complain if employees 
do not receive equal treatment. Management can no longer make 
a liberal interpretation of a sickness-absence policy. They must 
establish a definite rule and stick to it. Formerly, our policy was 
not announced to employees. The union will insist upon its being 
announced. Therefore, it must be more specific and fair to all. The 
new policy is specific and can be fairly and equably administered. 

During the subsequent discussion of the new policy, the fol- 
lowing comments were offered : 

1. I would agree that the proposed policy is mathematically accu- 
rate and that it can be equitably administered, but I also believe that it 
loses sight of the major purpose behind any human relations policy. 
As I see it, such a policy is set up to promote good will among all 
employees. The implications of this policy, that employees have a 
"chiseling attitude" will be resented and create bad feeling. We 
can well ignore the exceptional chiseler who may try to beat the system. 
Such isolated cases are unimportant and can be dealt with by intelli- 
gent supervision. — (Manager, Manufacturing Division A) 

2. I believe it is a mistake to leave the medical department entirely 
out of the picture in the proposed policy. Through our visiting nurse, 
the medical director is in close touch with every absentee. A sick 
absentee cannot return to work without his approval. I believe his 
department should keep the absentee records, and I believe he should 
be in a position to recommend an extension of salary allowance beyond 
the policy limits when he believes circumstances so warrant. I can 
see nothing wrong with the old policy under which we have operated 
so long without any trouble. I think the old policy should be continued 
with the exception of the changes that I have indicated. 

— (Manager, Industrial Relations) 

3. I dislike the emphasis on "chiseling employees." In my opinion 
the new policy itself is a "chiseling" policy which encourages employees 



to try and beat the system. I don't see why employees would not be 
tempted to regard a specific sickness allowance as a right and toward 
the end of a twelve months' period avail themselves of any credit that 
they feel they have "coming to them." It is my opinion that if we set 
up a policy that is obviously fair and liberal in its intent, the employees 
will accept it on that basis and make no effort to abuse it. 

— (Employment Manager) 

4. In my opinion, an announced policy must be one that the 
employee can easily understand. I am free to admit that I have found 
it difficult to understand the proposed system. It also appears to me 
to be a costly system in terms of the clerical work it requires. 

— (Manager, Manufacturing Division B) 

5. I am certain that cases will arise where employees will be puzzled 
why they receive their salary for one day's absence in a given month, 
when their salary is withheld for another day simply because their 
sickness credit for the 12 months' period was used up. Every such 
case will call for explanations and may lead to a complaint. 

— (Manager, Industrial Relations) 

The general consensus of the meeting was that the proposed 
new system should be held over for further consideration. It was 
suggested that the employment manager make a survey of exist- 
ing information on sickness absences among clerical employees. 

In accordance with this suggestion, the employment manager 
assembled the following statistical information : 

Table IV 
1936 Clerical Pay Roll: Length of Service (o-io Years) 


Production listing, in- 

Production listing 

Pay roll 

Factory cost account- 

Filing and mailing 

Manufacturing admin- 



Process administration 

































i 7 8 


Table V 

1936 Clerical Pay Roll: Days Lost through Sickness Absences by 

Departments and Length of Service 


Production listing, in- 

Production listing 


Factory cost account- 

Filing and mailing. . . . 

Manufacturing admin- 



Process administration 


















































Table VI 

1936 Clerical Pay Roll: Hypothetical Absence Allowances with 

Pay According to the Proposed New System (o-io Years 



Production listing, in- 

Production listing 

Pay roll 

Factory cost account- 

Filing and mailing 

Manufacturing admin- 



Process administration 
































































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Summary of the Statistical Information Regarding 
the Sickness Absences of Clerical Employees 

Total number on roll 456 

Number of employees absent during the year- 146 
Total number of working days lost: 779 
Distribution of sickness absences. 



44 lost I day 

31 "2 days 

II - 3 ■ 

10 » 4 • 


» 1-5 days 


iost 5 days 
» 5 " 
„ 7 „ 
» 8 •> 
" 9 " 


>• 1-2 weeks 



lost 10 days 
. |4 ■ 

• 15 - 

• 18 • 
•• 21 - 


- 2-4 weeks 




lost 25 days 

" 30 • 
« 31 • 
» 32 • 
" 33 - 
„ 59 . 

•• 61 » 


» 5-12 weeks 





5 10 15 20 25 30 35 40 45 50 55 60 65 

Number of days los+ 

Chart XIV. — New Process Rubber Company, Inc., sickness absences for 1936, 

clerical pay roll. 

In 1936, 456 employees were on the clerical pay roll of the New- 
Process Rubber Company. Of this number, 146 employees were 
absent because of illness for a total period of 779 days. 

If the proposed sickness absence policy had been in effect, and 
if the employees had availed themselves of their entire absence 
allowance, the company would have lost 11,670 working days. 

The majority of the employees were absent only 1 to 5 days. 

Case 29. The Wilson Case 

(Employees' demand for a wage increase covered dissatisfaction with alleged 

unfairness in rating.) 

The National Manufacturing Company had a wage schedule in 
which all occupations were listed and denned. Each occupation 
had a base rate, which listed the minimum and maximum of 
wages paid. The employees called this base rate a "bracket." 
For example, the base rate for a rough polisher was 55 to 59 cents 
per hour. A finish polisher received 59 to 66 cents per hour. 
This wage schedule was originally set up in negotiation between 
management and employee representatives as a result of a study 
of the relationships between one occupation and another. Asking 
for an increase in a bracket was tantamount to asking for a general 
raise in this occupation. Reviewing a rate card meant that the 
wages of an individual in any particular occupation were considered. 

The National Manufacturing Company had a signed agreement 
with the United Electrical and Radio Workers of America and 
operated an Employee Representation Plan. The setup of this 
plan allowed one representative for each department and occupa- 
tion. For instance, there was one union representative for the 
rough polishers and another for the finish polishers. In meeting 
with management, each of these representatives was allowed to 
bring a workman of his group with him if he so desired. 

On Jan. 13, 1937, Mr. Cameron, president of the union, sub- 
mitted a written complaint with reference to the polishers of 
department G-24 and asked for a meeting with management. 

The industrial relations supervisor sent a reply, advising the 
president of a meeting to be held on Jan. 14, 1937, at which the 
foreman and the employee representatives of department G-24 
would be present. 

On Jan. 14, 1937 the meeting was held in the office of the 
industrial relations supervisor, Mr. Avery. Those present were: 

Mr. Cameron, president of the union. 
Mr. O'Rourke, foreman, Department G-24. 
Mr. James, finish polisher and representative. 
Mr. Carlson, finish polisher. 



Mr. Smith, rough polisher and representative. 

Mr. Jones, rough polisher. 

Mr. Avery, supervisor, industrial relations. 

The following conversation took place: 

Avery: I have here a complaint from the union which I would like to 
read for the benefit of all those present : 

We, the Polishers of Department G-24 feel that the foreman 
is not rating the men properly in his department with respect to 
their occupation. In view of this we would like to go over the 
present brackets for an increase in them. 

(s) Cameron, President 

Mr. Cameron, inasmuch as you brought the complaint, have you 
anything to add? 

Cameron: No, not particularly, but these men feel that they are not 
treated right in the matter of rating and that they should get more 
money for their work considering the fact that it is hard work, 
dirty and wet, and that they have to buy more clothes than the 
average worker in the rest of the plant. 

O'Rourke : I believe that these men are earning good money regardless 
of their base rate, and that there's nothing to kick about. In 
the matter of clothing, I should say that extra wear and tear is 
one of the accepted hazards of the occupation. As long as I have 
been in the same game (and that is over 30 years), that hazard 
has been taken into consideration in the bracket of the job. 

Smith: Nevertheless, Mr. Avery, we don't feel that we're getting paid 
what other polishers in the community are getting. We feel that 
we should be given more consideration. 

James : That's right. I know a number of the employees of the Elec- 
trical Appliance Company and know for a fact that they are 
getting more money than we are, despite the fact that they don't 
do the high type of work we do. 

Jones: I've been a finish polisher all my life and I'm getting the rate 
of a rough polisher. 

Avery: That may be true, Mr. Jones, but remember we pay for the 
job and not the man. For instance, we might have a toolmaker 
and just because we haven't got a toolmaker's job for him, he 
might have to run a drill press. Obviously it would not be fair 
to pay him a toolmaker's rate on this job. 

Cameron: Yes, I agree with Mr. Avery. That is our policy. The 
rate carries the job and not the man. 

O'Rourke: If I had enough finish polishing work I should be glad to 
give it to you, Mr. Jones. On the other hand, I'm interested in 
keeping you working and don't want to send you home when I 
don't have finish polishing work to do. 

Cameron: I think that's understood by all of us. But how about the 
point that Mr. James and Mr. Carlson brought up . . . how about 
giving some consideration to an increase in rates? 


Avery: It is a policy of our company to pay at least the prevailing 
rate in the community for similar work. I believe we are follow- 
ing that policy; in fact, we're paying not only the prevailing rate, 
but more. 

Carlson: I don't believe it. I know a man who lives next door to me 
who gets as much as a dollar an hour. 

Avery: That may be true, Mr. Carlson. There may be a special 
reason why his company is paying him that rate. He may be 
paid for special ability. But, on the average, we are paying more 
than anyone else in the community for similar work. I have a 
chart here which shows the earnings of workers in similar occupa- 
tions in various companies. This is proof that we are paying 
more for polishing work than anyone. 

James: Well, who are these companies you're talking about? 

Avery: I'm sorry, but I'm not privileged to give you the names of 
these companies. But they are companies in this community 
which employ more than 200 people and have work similar to ours. 

Cameron: I don't believe we care what is paid in this community. 
We're only interested in our own people. And we want a bracket 

Avery: I'm sorry, Mr. Cameron, that we can't grant a bracket increase 
at this time. I'm not interested in increasing any brackets which 
will disturb our present wage schedule. For me to satisfy one 
group would only bring another group down on my neck. 

Cameron: Why couldn't we go over individual rates in this department 
and see if we can't do something for somebody? 

Avery: I've no objection to this if it is all right with Mr. O'Rourke. 
He knows the men better than I do and it is his prerogative to 
raise men within the brackets according to their ability, any time 
he sees fit. And, I believe, he's been doing that. How about it, 
Mr. O'Rourke? 

O'Rourke: You bet. 

Smith: Well, he hasn't been doing it. And I don't think he's fair the 
way he hands out raises or classes his people. 

Avery: I wouldn't say that, Mr. Smith. This is the first time I've 
had a complaint of Mr. O'Rourke or his department, and Mr. 
O'Rourke's been with us for more than 15 years. You must 
remember that we can't hit a home run every time we go to bat. 
All I say is, if Mr. O'Rourke has talked to you and told you 
the reason why he couldn't give raises and been fair about it, I 
don't see why you have cause to complain. 

Cameron: Why can't we look over the rate cards? 

O'Rourke: I'm willing to go over them if Mr. Avery wants to. 

Avery: Why don't we? (Calls for the rate cards of Department G-24. 
The secretary brings them and the group goes over each card. 
In the process of doing this, Mr. James picks out the card of 
Mr. Wilson, a fellow workman. He hands it to the foreman.) 

James: How do you account for this fellow, Wilson, being a finish 


O'Rourke: He isn't a finish polisher. He's an acid dipper. 

James: Well, his card here classes him as a finish polisher. 

O'Rourke: There must be some mistake. 

James: Well, there isn't, and you signed the card. 

O'Rourke: I don't know how that happened, but anyway, he's not a 
finish polisher. 

Carlson: You're damn right he isn't. But he was told he was, and he 
thinks he is. And our men are sore about it, see? They say, if 
Wilson is a finish polisher then we're silversmiths. 

Cameron: Well, is that what's bothering you fellows . . . that this 
Wilson here is called a polisher and isn't? 

Carlson: Yeah, he happens to be a friend of O'Rourke here and he's 
been bragging about it for weeks. And our fellows say that if 
Wilson is getting paid as a finish polisher we ought to have more 

Cameron: Mr. Avery, I think they're right, don't you? 

Avery: If it is true that Wilson gets the pay of a finish polisher, I think 
the men have a cause for complaint. But as Mr. O'Rourke says, 
there must be some mistake. Let me see that card . . . (exam- 
ines card). Why, it says right here that the boy is getting the 
pay of an acid dipper, and that's. . . . 

Smith: Let me see that card. ... If this is so, we haven't got anything 
to kick about. We thought he was getting a finish polisher's 

Avery: Well, according to this card, he isn't. His classification as a 
finish polisher was a mistake. Does that settle everything? 

James: As far as I'm concerned. 

O'Rourke: Well, and I want to tell you fellows that Wilson is no 
special friend of mine. I do happen to have known him before he 
was employed here, but I treat him just the same as I do you. I 
didn't know that Wilson was doing any bragging. I do wish that 
you fellows would come to me first instead of bringing me on the 
carpet with Mr. Avery. 

Avery: Well, Mr. Cameron, I think this is all straightened out, don't 

Cameron: Yes, I believe it is. 

Avery: Before we adjourn, I should like to add for the information of 
all that you should feel free at any time to see me if anything is 
bothering you. On the other hand, we expect that you have and 
will continue to have confidence in your foreman and discuss 
matters with him first. 

Smith: Well, if he shows a willingness to talk with us, I'm sure we'll 
be glad to talk to him. 

Avery: How about it, Mr. O'Rourke? 

O'Rourke: Well, I've always done that. I believe there was a little 
misunderstanding here. 

Cameron: Well, let's adjourn and forget it. 

Case 30. The Group-leader Plan 

(Description of a change in the method of payment and consequent changes in 


Plant No. 10 of the National Manufacturing Company, Inc. 
manufactured refrigerators, and motored appliances such as fans 
and vacuum cleaners. Operations were carried on in a thoroughly 
modernized plant with an overhead conveyor assembly line in the 
refrigerator division and bench assembly lines in the motored 
appliance division. In 1936 the plant employed about 5,000 men 
and women. 

About the year 1918 the executives of the National Manufac- 
turing Company, Inc. changed their payment plan from straight 
piecework to group piecework. They gave the following reasons 
for this change: 

1. Under the straight piece work system, exceptionally skilled 
employees were frequently penalized. The foreman tended to entrust 
these individuals with the more difficult tasks in order to make sure 
that they were well done. Consequently, a less skilled worker who 
received nothing but the ordinary run of assignments was often able 
to earn a higher wage than the more skilled worker. This inequitable 
distribution of earnings could be avoided under the group piece work 
plan since earnings were pooled, and individual workers were given 
their proportionate shares. 

2. The second difficulty under the straight piece work system was 
the problem of favoritism. There were many complaints that foremen 
tended to discriminate and give to their favorites the so-called "fat" 
assignments, that is, long-run jobs on which an operator could gradually 
get into the swing of the job and steadily increase his total output, 
and consequently his earnings. "Lean" assignments were either very 
complicated or else of the short-order variety on which an operator was 
hardly able to establish a maximum pace. The group payment sys- 
tem obviated this difficulty by putting a premium on co-operative 
effort. Since the earnings were pooled, it was in the interest of the 
group to divide the work to suit the abilities of the individual workers 
and to coordinate their individual efforts as effectively as possible. 

3. A third difficulty under straight piece work was the problem of 
training new workers. The training of apprentices was a day-rate job 
much disliked by the workers. The more able an individual worker, 
the greater his dissatisfaction if he was asked to break in a new worker. 



Under the group piece work plan it was in the interest of the group to 
entrust training to the most efficient and able workers and thus shorten 
the learning process of newcomers as much as possible. 

Management believed that the group piecework system was 
most effective in small groups, since it was possible for each worker 
to know the others, and individual differences among workers 
could be utilized most effectively to form an integrated group 
activity. Such integration presupposed leaders who were mem- 
bers of the groups, and who were thoroughly conversant with the 
situation at the work level. It was necessary for someone to be 
responsible for seeing that each member of the group worked 
under the most effective conditions for him, and that raw mate- 
rials or partly finished products were on hand when needed for 
processing or assembling. In response to this need, the group- 
leader plan was developed as an adjunct to the group-payment 

Another aim of management in developing the group-leader 
plan was to bring forward those people who showed real leadership 
abilities. The group-leader position was to be a testing ground 
for future supervisory material, although appointments to such 
positions would not commit management to future promotions. 
Therefore management decided to appoint to these positions 
workers who were expected to be of supervisory caliber. Man- 
agement believed that it was also important to appoint, as group 
leaders, workers who were acceptable to the group. In some 
cases, when a group proposed two or three eligible men as group 
leaders, management allowed the workers to make their own 

Under this plan the group leader was not a representative of 
management. The function of delegated authority belonged to 
the foreman and his assistant. As accredited representatives of 
management, the latter were given parti tioned-off office space in 
the various departments where the groups were at work. Man- 
agement made it clear that the foreman and the assistant foreman 
were the official representatives of the company. They were 
leaders of groups of workmen rather than of individual workers. 
The group leader, however, was identified with a group of indi- 
vidual workers. Instead of being a representative of management, 
he was what might be called a "leading hand," or " working 


This conception of the group leader's status was also expressed 
in his wage payment. He was still an hourly rated employee 
and usually received the maximum rate for his particular kind of 
work. For his services as group leader, management paid him 
an additional remuneration. This was determined by (1) the 
length of time required to train for his job and (2) the number of- 
people under his supervision. Accordingly, group leaders received 
an additional hourly compensation ranging from $0.03 per hour 
for less skilled work to $0.10 per hour for more skilled work. 

The duties of the group leader and the number of workers under 
his supervision varied somewhat with the type of work in which 
his group was engaged. A group of girls winding electric stators 
for motored appliances might contain as many as 30 or 40 workers, 
while a subordinate group in an assembly line might be made up 
of only six. On the whole, management preferred to restrict 
groups to 15 members wherever possible. 

Management expected the group leader to build up and main- 
tain group morale. It was his function not only to integrate his 
group but to mediate between it and other groups and between it 
and management. He was expected to see that the group had as 
steady a flow of work as the business situation permitted, and 
that it was adequately supplied with necessary piece parts and 
raw materials. The group leader also taught newcomers their 
job and helped them, as well as older employees, to acquire the 
most efficient work habits. 

In the minds of his fellow group members, however, the group 
leader's most important activities were those dictated by job 
requirements. He was responsible for such paper work as check- 
ing order specifications and reporting the number of units finished 
by the group. He had to be alert to see that jobs were carried 
out according to stated requirements. For instance, on a punch 
press operation for which copper was specified it happened that 
material of prescribed dimensions, but brass instead of copper, 
was delivered to the group for the production of a piece part. 
The die was set up and the brass material run off to produce the 
first few pieces for preliminary inspection. The floor inspector 
passed the parts, failing to notice that the wrong material had 
been used. The error was not discovered until the entire order 
had been completed and subjected to final inspection. In this 
situation it was agreed that the group leader should have checked 


the drawings and specifications for the type of material to be used, 
and that the floor inspector should have done likewise. The 
group was not paid for the work it had performed. 

The workers tended to prefer group leaders who were skilled 
workers themselves and who confined most of their attention to 
the actual work on hand. They did not like to see their leaders 
spend much time and energy on activities that seemed to them to 
have no immediate connection with their own work. 

At one time in the administration of the group-leader plan, 
management was confronted with the following problem : 

One group of workers on the assembly line petitioned manage- 
ment to remove its group leader. This group leader was also 
a union representative, and, in complaining to management, 
the workers had no other fault to find with him than that he 
spent too much time on union activities. In accordance with its 
general policy of employing group leaders who were acceptable to 
their groups, management would ordinarily have removed this 
man and appointed some other worker to the position. In this 
case, however, management felt that it would be accused of dis- 
criminating against a representative of the union. 


Case 31. Wage Attachments at the National 
Manufacturing Company, Inc. 

A wage attachment, trustee or assignment, is an instrument by 
means of which a creditor takes legal action to enforce the settle- 
ment of an overdue account. Every time such an attachment is 
received, management is obliged to withhold everything over $20 
the employee-debtor has earned up to the time that the notice has 
been served, or 25 per cent of all money earned by the employee 
in case of assignment. When the case comes up in court, man- 
agement must file an answer stating the amount held. This not 
only involves time and labor in the paymaster's office in addition 
to regular duties but also places an expense on the company for 
attorney's services in filing the answer. 

Most companies have no desire to dictate to their employees 
how they should handle their personal affairs, but as an attachment 
forces a company to withhold a portion of the employee's wages 
or earnings and make a report to the court when the case comes 
up for trial, it thus brings the company into the employee's per- 
sonal business. 

In order to reduce such interference to a minimum, the man- 
agement of the National Manufacturing Company had early 
adopted the following policy : 

Wage Attachments 

Employees whose wages are attached are subject to dismissal. The 
first attachment or trustee carries with it a warning; a second attach- 
ment leads to an investigation. If management is convinced that the 
attachment was due to indifference on the part of the employee, 
the latter will be dismissed. A third attachment carries with it the 
penalty of dismissal without further investigation. 

This policy was never strictly enforced. Nevertheless, as long 
as that ruling was in effect, the number of such attachments was 
at a minimum. 



During the 1930 business recession, management suspended 
this rule entirely. In the interest of its employees, management 
adopted a policy of extreme leniency and took steps to develop 
a better procedure with regard to wage attachments. Mr. San- 
ford, cashier and trustee, wrote a letter to the president of the 
Bar Association, soliciting him to notify all attorneys and ask for 
their cooperation to send an advance notice to the company before 
an employee's wages were attached. Mr. Sanford also sent letters 
to various retail credit houses and clothing establishments. He 
was gratified by the response. 

In the spring of 1935, management developed a system of form 
letters with regard to wage attachments. As soon as the creditor 
or his legal representative notified the paymaster's office that an 
employee had neglected to take care of his account, the cashier 
would send out the following notice : 

Works Correspondence 



Kindly communicate with 

and take care of an account which they have against you. This 
must be given your immediate attention as otherwise they will 
be forced to take legal action. Do not allow this to happen. 

L. D. Sanford, Cashier — Trustee 

One copy of this notice was sent to the employee-debtor; the 
second copy was sent to his foreman ; and the third copy was sent 
to the supervisor of industrial relations. 

The foreman would interview the employee and offer his advice. 
If, in his opinion, the employee was being exploited, the foreman 
would bring the case to the cashier's attention. Mr. Sanford 
would then offer his assistance, without, however, pushing himself 
into the private affairs of the employee. He relied rather on the 
fact that one grateful employee told another, and that whenever 
an employee became involved in financial difficulties he would 
voluntarily apply for aid. 

If an employee disregarded the advance notice and continued 
to neglect his account, the creditor, or his legal agent, would be 
apt to serve a wage attachment. In this case, the cashier sent 
out the following form letter: 


Works Correspondence 



Kindly communicate with Attorney 

and have the attachment placed against your wages today released. 
This must be taken care of at once in order for you to draw your 
wages on pay day. 

L. D. Sanford, Cashier — Trustee 

This letter also was sent out in triplicate, one copy each to 
the employee-debtor, his foreman, and the supervisor of industrial 

The wage attachment, which is sent to the cashier's office, 
commands him to attach all goods over $20. The writ is return- 
able in court four weeks from the date of issue. For every inter- 
vening week, the attorney is free to serve other attachments. 

If the case is brought before the court, the cashier makes the 
following return : 

Commonwealth of District Court of 


And now National Manufacturing Company summoned as 
Trustee of the principal defendant in the above entitled action, 
appears and makes answer that, at the time of the service of 
the Plaintiff's writ upon him, 
it had in its hands or possession the sum of 

but had not at said time of service any other goods, effects, or 
credits of said defendant in his hands or possession and of this he 
submits himself to examination, upon his oath. 

National Manufacturing Company 


subscribed by him is true, before me. 

.Make oath that the foregoing answer 

Notary Public 

During the year, August, 1936, to, July, 1937, the cashier's 
office handled 460 actions. Two hundred and ninety-six of these 



were advance notices and 164 were trustees. The diagram follow- 
ing shows the distribution of these actual and threatened wage 

Sept. Oct. Nov. Deal Jan. Feb Mar. Apr. May June July 
1936 I 1937 

Chart XV. — National Manufacturing Company, Inc., wage attachments, actual 
and threatened; August, 1936 to July, 1937. 

The cashier became alarmed at the increase of actual wage 
attachments and conferred with the industrial relations supervisor 
as to whether a reconsideration of company policy was advisable. 

Case 32. Loans to Employees at the New 
Process Rubber Company, Inc. 

During the early years of the depression (1930-193 2) the 
management of the New Process Rubber Company, Inc., was 
distressed by the fact that many of their employees were being 
victimized by loan sharks and the so-called 3 per cent per month 
finance companies. From an increasing number of complaints 
by local tradesmen and actual wage attachments, it was apparent 
that at least 15 per cent of the company's employees were in 
financial difficulties. Many employees, indeed, were staggering 
under a hopeless burden of debt. For instance, Dante Feroni, a 
sweeper, had borrowed $200 from a finance company to meet some 
mortgage payments and pay hospital expenses incurred by his 
wife's seventh confinement. At 3 per cent per month, Dante 
was required to pay interest of $6 per month or $1.50 per week. 
His weekly income was $20.00. After paying $1.50 interest to 
the Finance Company, he was left a residue of $18.50 with which 
to meet all current expenses for a family of ten. (Dante Feroni 
had assumed the support of his mother-in-law.) Barring any 
accidents (illness, decrease in work, etc.) Dante was just able to 
meet the weekly interest charge plus 50 cents toward partial 
liquidation of the loan. Mr. Feroni had struggled along under this 
debt for 18 months and had managed to reduce his original debt 
to $180. During the last six weeks he had barely been able to 
meet the interest charge, and there was little prospect that his 
financial burden could be relieved. 

Other employees faced even more desperate situations. Car- 
roll Horton had borrowed $100 to cover necessary household 
expenses. At 3 per cent per month, he had paid $36 in interest 
charges during 1931. At the same time he had been able to pay, 
$12 toward a partial liquidation of his loan. In January, 1932, 
he still owed the finance company $88. At this time his weekly 
earnings were reduced to $11 so that he was unable to make any 
payments whatever to the finance company. At the end of the 
year he owed the finance company not only $88 (the remainder 



of his original loan) but $30 in unpaid interest charges. In 
January, 1933, accordingly, Carroll Horton owed the finance 
company $118. Since he was barely able to make small payments 
(50 cents per week) to pay for accumulated interest charges, he 
was faced with the discouraging prospect that every month his 
debt to the finance company grew larger instead of smaller. 

Not only hourly rated workers, but supervisors also were 
involved in debt. George Harmon, for example, was a foreman 
who earned $2,600 a year. He was married and had three children. 
During the early years of the depression, his brother moved his 
wife and two children into Harmon's home, since Harmon was the 
only one who was earning any money. Mr. Harmon made every 
attempt to support both families, but after two years he was 
almost desperate. He could not sleep for worrying over his debts 
and feared that he was neglecting his work. His debts were as 
follows : 

Finance company (A) $240 

Finance company (B) 150 

Unpaid grocery bills 60 

Medical bills 30 

Personal debts to friends 90 

Total $570 

Mr. Harmon paid $7.50 and $4.50 a month interest to the two 
finance companies and $5 a week to the grocer, who had threatened 
to withhold further credit. Mr. Harmon was particularly dis- 
tressed on account of his personal debts. He feared that these 
might bring about the loss of friendships that had been cherished 
for many years. 

The preceding cases are typical and persuaded the management 
of the New Process Rubber Company that some means must be 
devised to aid these employees. After considerable study of the 
situation, management worked out a plan of cooperation with a 
local bank, which agreed to grant loans to needy employees who 
were considered a good risk. The following procedure for man- 
aging a loan application office as an adjunct to the employment 
department was developed. 

Application for an Execution or Personal Loans to Employees 
of the New Process Rubber Company, Inc., by the Bank. 

This system is to establish internal procedures and Company 
policies incidental to the operation of a plan to assist employees in 
obtaining personal loans from the Bank. 


The Company through its Industrial Relations Department will 
act in a service capacity in that it will furnish application forms and 
assist employees in properly filling them out, and in cases where loans 
are granted by the Bank, will upon the employee's authorization make 
deduction of payments from the employee's wages and forward them 
to the Bank when due. In no case will the Company recommend 
approval or rejection of any application. 

This procedure in no way obligates the Company to pay any bal- 
ance due the Bank on any note in default, as all loans will be a direct 
contract between the Bank and the employee, as borrower. 

I. Amount of Loans and Terms. 

a. Loans may be made in amounts up to $1,000 for a period not 
exceeding one year at a discount of 5%. 

Loans may be paid off in less than 12 months but will be 
discounted on a 12-month basis when made. 
The Bank will require a minimum of three months' discount, 
but refunds will be made to the borrower, when payment in 
full is made in a period of less than twelve months as follows : 

1. Paid in three months — Refund of 5% of face of loan for 
nine months. 

2. Paid in 3-6 months — Refund of 5% of unpaid balance at 
end of 3rd month, for 6 months. 

3. Paid in 6-9 months — Refund of 5% of unpaid balance at 
end of 6th month, for 3 months. 

4. Paid in 9-12 months — No refund. 

A loan of $300 is requested, and the applicant wishes to 
repay it in six months. 

1. The Bank will draw the note for 12 months and deduct 
discount of $15 sending a check to the borrower for 

2. The Loan Application Office in obtaining deduction 
authorization from the borrower will divide the face of 
the loan by 12, representing the number of salary 
checks received in a period of six months, and will then 
request a refund of $7.50 discount from the Bank. 

b. The Bank has made arrangements with the Midvale Life 
Insurance Company whereby the life of the borrower in the 
case of unsecured loans will be insured for the term of the 
loan, in an amount sufficient to pay off the unpaid balance at 
any time, should the borrower die. 

c. The cost of this insurance will be paid entirely by the Bank. 

d. On loans of $500 or more, the borrower must submit to a 
physical examination for insurance purposes, the medical 
examination to be provided by the Bank. 

e. Signatures of both husband and wife will be required on the 
note if the applicant is married. 


/. The Bank may at its discretion require one or two co-makers 
or none at all. 

g. The applicant and each co-maker (when required) must be 
earning an income sufficient to meet their current expenses 
and in addition provide for meeting the payments on the loan 
when due, according to the schedule agreed upon. 
II. Method of Application. 

a. Employees wishing to apply for a loan will go to the Em- 
ployees' Loan Application Office where they will be given 
the following forms: 

i . Application for Loan. 

2. Application for Insurance. 

3. Bank Signature Card. 

4. Note. 

The Loan Application Office will assist the employee as much as 
possible in the rilling out of these forms, particularly as regards 
information which can be obtained from Company records, such 
as position, length of service, employment record, rate of pay, or 
similar data. 

The Loan Application Office will also offer suggestions or criti- 
cisms necessary to make the application as favorable as possible 
consistent with the facts, and will verify such information obtain- 
able from company records together with all signatures. 
The Loan Application Office will insure that the following 
information is forwarded to the Bank with each application: 

1. A record of all indebtedness owed by the applicant for 
which the company is making current deductions and the 
amount of such deductions. 

2. Finance Company, or Budget Payment Books covering any 
items of indebtedness reported by the applicant in his 
application, to be forwarded to the Bank with application. 

3. Account Numbers of the borrower with any credit concern 
or charge account number with any department store 
to be shown on application. 

4. Salary, wages, or other income of any member of appli- 
cant's family who could assist in payment of loan if required 
to do so. 

b. Employees on salary, and the Loan Application Office will 
be governed by the following rules in answering questions 
on any application pertaining to salaries earned: 

1. Employees on Yearly Salary. {Semi-Monthly by Check.) 
Employees on this roll in answering any question relative 
to rate of salary need only answer "Over $2,000 per year." 
The Bank, however, will have the privilege of requesting 
actual figures from the Treasurer or Private Paymaster, if 
conditions warrant such information. 

2. Employees on Weekly Salary. {Weekly by Cash.) 
Employees on these rolls must state exact amount. 


3. The supervisor of Loan Application Office will cooperate 
with the Private Paymaster at all times in maintaining 
the confidential nature of salaries on the Private Payrolls. 

III. Loan Application Office Procedure after Application. 

The Loan Application Office before sending an application to the 
Bank will make out the following forms: 

a. Record of Application. 

b. Questionnaire to Supervision. 

The Record of Application is merely a copy of the pertinent facts 
as contained in the application itself and, after approval by the 
supervisor of Employees' Loan Application Office, will be filed 
for reference. 

The Questionnaire to Supervision is for the purpose of obtaining 
an indication as to the probable continuity of the applicant's 
employment for the term of the loan. It is not a guarantee of 
such employment. This form will also be filed for reference. 
Applications and their attendant forms must be approved by the 
Supervisor of Employees' Loan Application Office, or in his 
absence, by the Employment Manager, after which they will 
be taken daily to the Bank by messenger. 

IV. Rejected Loans. 

On applications which are rejected by the Bank the note will be 
returned the day following by the Bank to the Loan Application 
Office where it will be returned promptly to the applicant. 
Any questions as to the reasons for rejection must be taken up 
with the Bank directly by the employee. 
V. Accepted Loans. 

On accepted loans the Bank will issue a check payable to the 
employee, the amount of which will be the face of the loan less 

The Loan Application Office will establish a record of the loan 
and before presenting the check to the employee will require the 
employee to sign, in duplicate, an authorization to the company 
to make the necessary deductions from his wages and payments 
to the Bank. One copy of this authorization will be sent to the 
Bank and the other copy handled as follows: 

a. If the employee is on the Factory Payroll, the authorization 
will be sent to the Factory Payroll Accountant. 

b. If the employee is on the Salary Payrolls, the authorization 
will be sent to the Private Paymaster. 

c. The Bank will assume all responsibility for the investigation, 
verification, and, subject to their own discretion, the liquida- 
tion of any debts reported by the applicant as being the 
reasons for which the loan is desired. 

In such instances, the Bank will issue as many checks as may 
be required to liquidate such debts, made payable jointly to 
the applicant and the creditor. These checks will be sent to 
the Loan Application Office where they will be given to the 


applicant who after endorsement will forward the checks to 
the various creditors. 
VI. Deductions. 

A. Factory Payroll. (Weekly Wages in Cash.) 

i. The face of the loan will be divided by 50 for determining 
weekly amount of deductions, unless the loan is for a 
shorter period as provided in paragraph I-A. 

2. No deductions will be made for vacation weeks, and no 
doubling up will be made in succeeding weeks. 

3. Deductions will only be made during any pay period when 
the amount of wages due the employee is sufficient after 
all prior claims, to meet the payment. 

4. Deductions for items owed the company and for social 
security taxes will be considered prior claims to loan 

5. Involuntary Trustee Assignments will take preference 
over loan deductions. 

6. Voluntary Assignments and Loan Deductions will take 
precedence on a basis of the date of assignment. 

7. At the close of each month the Factory Payroll Deduction 
Office will report to the Private Paymaster the total 
deductions made for the month, by individual loans. 
Included also in this report will be the names of all bor- 
rowers for whom incomplete or no deductions at all have 
been made in the current month, with a note after each 
such name explaining the reason therefor, such as vaca- 
tion, illness, or insufficient wages due to short time. 
This monthly report will include only those deductions 
which have been returned to cash within the current 

B. Salary Payrolls. 

Items 3-4-5 and 6 as applied to Factory Payroll also apply to 

Salary Payrolls. 

Deductions on the Yearly Salary Payroll will be on a basis of 

face of the loan divided by 24, unless loan is for a shorter period 

as provided in paragraph I-A. 

Deductions on the Weekly Salary Payroll will be on the same 

basis as on Factory Payroll. 

Deductions will be made for vacation periods on Salary 

VII. Monthly Payment to Bank. 

The Private Paymaster will combine the Factory Payroll Deduc- 
tions with those of the Private Salary Payrolls and will send a 
check to the Bank by the tenth of the month, following the 
month in which deductions were made, with a supporting 
schedule by individual borrowers. 

This monthly report to the Bank will list the names of all bor- 
rowers regardless of whether deductions are made or not, and 


will show the reasons for non-deductions as explained in para- 
graph VI — section 7. 
VIII. Records and Reports. 

The Loan Application Office will maintain a file for each employee 
to include all papers and correspondence pertaining to his loan. 
A summary record will also be maintained in such a manner that 
a monthly report can be sent to the Treasurer, Vice President in 
charge of manufacturing, and the Manager of Industrial Rela- 
tions, showing: 

a. Number of applications received monthly. 

b. Number of applications accepted — month and amount. 

c. Face of notes outstanding. 

d. Total applications to date. 

e. Total accepted to date — amount. 

/. Unpaid balances at the end of each month. 1 
The Loan Application Office will notify the Bank of the termina- 
tion of employment of the borrower. 

All correspondence between the Loan Application Office and the 
Bank must be written over the signature of the Supervisor of 
Employees' Loan Application Office and approved by him, or in 
his absence, by the Employment Manager. 
The Factory Auditor will audit the Loan Application Office 
Records at least every three months, and will reconcile payroll 
deduction accounts with the General Ledger Control every 

The plan worked as follows: The case of George Harmon 2 may 
be taken as a convenient illustration. The treasurer of the New 
Process Rubber Company arranged with the bank to advance the 
necessary money to consolidate all Harmon's debts. It was 
agreed that all his bills were to be paid with company checks to 
ensure that all obligations would be met. The bank advanced 
$598 — discounted at $28 — and sent Harmon a check for $570. 
With this money, Harmon cleared all his debts. During the 
ensuing twelve months Harmon paid $48.66 a month to cancel 
his obligation to the bank. His brother, meanwhile, had been 
able to secure a job with a construction company, which enabled 
him to resume the responsibility of caring for his own family. 
At the end of the year, Harmon could therefore anticipate being 
entirely free from debt. Without a loan from the bank, Harmon 
would have had to pay $10.50 every month to the finance com- 
panies in interest alone without in any way liquidating the original 

1 The information for this item must be reported to the Loan Application Office 
by the Private Paymaster and the Factory Payroll Deduction Office. 

2 See p. 196. 


In another case, the financial circumstances were as follows: 
James Sanderson, an outsole pressman, owed the following: 

Finance company $130 . 00 

Back rent 44.00 

Current rent 35 . 00 

Furniture company 100 . 00 

Electric light & gas co 18 . 00 

Unpaid grocery bills 30 . 00 

Total $357.00 

He was paying $3.30 a week interest to the finance company, 
$3 a week to the electric light and gas company, which was threat- 
ening to turn off the supply, $2 a week to the furniture company, 
and $1 a week each to the landlord and the grocer. The total 
weekly payments amounted to $10.30. The weekly income was 
$30, leaving Mr. Sanderson $19.70 for the support of himself and 
four dependents. With a loan of $374.50 (discounted at $17.50) 
from the bank, Mr. Sanderson was able to consolidate all his 
debts. By making weekly payments of $6.50 to the bank, he 
was able to free himself from debt by the end of the year. 

Loans rejected by the bank show some of the most amazing 
financial tangles in which employees had become involved. 
Gordon Grant, 26 years of age, had been with the company for 
6 years and occupied the position of junior accountant. His 
salary was $31 a week. On July 2, 1937, Grant applied for a 
loan of $84. He stated that he wished to get married and proposed 
to pay off small bills in order to get started right. Investigation 
by bank officials disclosed the following situation: Grant owed: 

Florist (flowers sent during courtship) $ 18 

Department store charge account 25 

Department store budget plan (rug) 78 

Mens' furnishing 80 

National Bond and Investment Company (payment on car) 180 

Tax on car 7 

Refrigerator 90 

Cooperative bank (first payment on home) 200 

Total $678 

At the time of applying for a loan, Grant was also negotiating 
the purchase of furniture on the installment plan. 

Grant's future wife was working as a clerk for an insurance 
company. She earned $18 a week. This additional income could 
not be relied upon, since the insurance company had a policy that 
all female married employees would be discharged six months 
after marriage. 


The following tables give a monthly summary of the records 
kept by the Loan Application Office. Table A shows the number 
of applications that were received and accepted by the bank, the 
amount of money involved in accepted applications, and the 
unpaid balances on total loans to date. 

Table B represents the distribution of alleged reasons for 
requiring the loan. 

Table X 

Monthly Statement of Loans to Employees 

(as of September 1, 1938) 

Total for 

Number of applications received 

Number of applications accepted 

Per cent accepted 

Total amount involved in accepted applications 
Unpaid balances 

Total to 





$ 33,739-65 



Table XI 

Analysis of Reasons Alleged for Requiring a Loan 

(Accepted applications only) 

Classification of 
reasons given 




Dental care 






Household expenses: 





Frigidaire purchase 








Real estate: 







Business propositions 



Miscellaneous bills 

Personal loans 

Industrial loans 

Rent arrears 

Reduce payments on loans. 




Grand totals 

ber in 













1 .92 







ber to 



























1. 12 







1. 12 








. 11 










Case 33. The Six Little Jackmen 

(Conflict between unemployment insurance and informal company policy of taking 
care of superannuated employees.) 

Ever since the beginning of rubber footwear manufacturing, 
the New Process Rubber Company had produced a heavy, four- 
buckle overshoe made out of rough woolen material with a thick 
fleece lining and massive outsoles. Gradually this type of over- 
shoe had been displaced by lighter and more modern styles. By 
1937, this kind of heavy service shoe was sold only in rural sections. 
Nevertheless, each year, cumulative small demands for this 
product were sufficient to permit a reasonably stable annual 
production of 25,000 pairs. 

In an effort to find suitable employment for superannuated 
employees, management had retained the old-fashioned table 
method 1 of manufacturing these overshoes and assigned long- 
service employees to this work. The gum footwear department 
had such a table where the following six long-service men were 
engaged at this kind of work : 







F. Strozzi 







Gaiter Maker 
Gaiter Maker 
Friction Parts 
Gaiter Maker 
Gaiter Maker 
Gaiter Maker 




D. Fieori 

C. Carnini 


V. Cimino 

H. Hagopian 


P. Bagdikian 


The table was set up near a window and was part of the 
regular manufacturing establishment. The men formed a little 
work group of their own and worked at their own pace. The five 
first-named workmen performed assembly work at the table, while 
Peter Bagdikian spent part of his time in the storeroom and the 

1 Cf. Case 24, Training of Employees, p. 134. 



rest in supplying the group with material. The men were well 
acquainted with each other and worked together in great harmony. 
To the other employees these men were known as "the six little 
jackmen," an affectionate collective noun that had its origin in 
the men's height (not one of them was taller than 5 feet 4 inches) 
and the fact that these men continued to operate the old-fashioned 

Ordinarily, these overshoes would have been assembled by 
women at a piece rate which would guarantee them earnings of 
50 cents per hour. Men on assembly jobs were paid 60 cents per 
hour. In order to provide the six little jackmen with a reasonable 
wage, management paid them a special rate which enabled them 
to earn 55 cents per hour. This extra compensation actually 
amounted to a hidden pension. 

In the spring of 1938, during the recession, the volume of 
stock in hand of this type of overshoe had reached such proportions 
that management decided temporarily to discontinue production. 
The six little jackmen were put on the layoff list. It rarely 
occurred that employees with 25 years or more of continuous 
service were laid off. But to meet such a contingency, manage- 
ment had the following provision to cover their period of unem- 
ployment. A policy with regard to termination payments 
stated that: 

Such employees will receive for a period of one year $25 per month 
with an increase of $1 per month for each additional year of service over 
20 years. 

When the six little jackmen had been laid off, they became 
eligible to receive this remuneration. But, such payments con- 
flicted with the provisions of the State Unemployment Compensa- 
tion Act, which defined an unemployed person as "one who 
performs no wage-earning service whatever and who earns no 
wages or other pay for personal services.' ' 

Management was desirous, however, that these six men should 
receive unemployment benefits, for several reasons : 

1. It would be more acceptable to the men, inasmuch as their 
previous contributions legally entitled them to such compensation. 

2. The company on its side had contributed to the Unemployment 
Insurance Fund and had a right to expect that their pension expenses 
should be reduced by the amount of such unemployment compensation. 


To safeguard the status of the six men, management obtained 
a ruling from the Unemployment Commission whereby a weekly 
gratuity might be paid to these employees during the three weeks 
of waiting period without jeopardizing their eligibility to receive 
unemployment compensation. In accordance with such a ruling, 
the policy regarding termination benefits for long-service employ- 
ees was rewritten as follows: 

1. At the time of termination they will be paid as a gratuity one 
week's allowance on the basis of $25 per month with an increase of $1 
per month for each additional year of service over 20 years. This 
allowance will also be paid again in the second and third week after 

The weekly allowance will be figured as three times their monthly 
gratuity rate divided by thirteen, adjusting all fractional parts of a 
dollar resulting from such computation, to the next highest dollar. 

2. Immediately upon termination such employees will be expected 
to register as unemployed with one of the district ofiices of the State 
Unemployment Compensation Commission as provided by the State 
Unemployment Compensation Law. 

The Employment Department will at time of termination give the 
employee a letter explaining the ruling made by the Commission that 
such gratuity payments do not affect the waiting period. 

3. If such employees remain unemployed after they have received 
their maximum unemployment benefits, and the aggregate of such 
unemployment benefits plus the previously mentioned three weeks' 
gratuity does not equal the equivalent of their gratuity rate for twelve 
months, additional gratuities will be paid them each week at their 
previously determined gratuity rate until they have received an amount 
equal to their gratuity rate for twelve months. 

4. Such employees are subject to recall to work whenever employ- 
ment becomes available and barring bona fide disability, must report to 
work. Failure to report on due notice will cause termination of gratu- 
ity payments and will prejudice opportunity for future employment. 

Should such employees secure other work with earnings equivalent 
or greater than the amount of gratuities being received from the com- 
pany, such payments by the company will be discontinued. It is 
the obligation of the employee to notify the company if such employ- 
ment is secured. 

5. All gratuity payments will be made weekly by the private pay- 
master, and deductions will be made for unemployment and old age. 
taxes for which the employee would be subject. These payments will 
likewise be considered as taxable wages subject to employer contribu- 
tions both State and Federal. 

6. These provisions are subject to change without notice, par- 
ticularly as they may be affected by Social Security Legislation. 


In accordance with the new system, each one of the "six little 
jackmen" received the following letter explaining the basis on 
which the benefits would be paid: 

March 29, 1938 
Dear Mr : 

A week ago you received notice that we would, unfortunately, 
have no work for you after March 30. However, in order to help 
you out financially we are granting you one week of your vacation 
at this time for which you will receive vacation pay amounting to 
$22.00 This will postpone your termination of employment for one 
week to Wednesday April 6. 

You should then immediately register as unemployed at your 
nearest State Unemployment Office, and show them this letter 
together with your Social Security Account Number 000-0000. 

As a further recognition of your long service with this com- 
pany we shall pay you for the next three weeks a gratuity of $10 
each week. According to a ruling of the State Unemployment 
Commission the payment of this gratuity will in no way affect the 
length of your waiting period. You should, therefore, receive 
unemployment compensation beginning at the end of your 4th 
week of waiting, some time in the first week of May. 

If you still remain unemployed at the expiration of these unem- 
ployment benefits we shall then resume payment of the weekly 
gratuity of $10 until such time, within the year, when you are 

Very truly yours, 
(s) J. C. Randall Employment Mg. 
New Process Rubber Company 

The gratuity checks were paid as agreed upon for the three- 
week waiting period. Then they were stopped to allow the 
employees to receive their unemployment compensation in 
accordance with the law. 

Two weeks later, Messrs. Cimino, Hagopian, and Bagdikian 
came to see the employment manager and complained volubly 
that they had not yet received their unemployment compensation 
and were in need of financial assistance. They reported that 
none of the other men in their group had as yet received any 
compensation either. The employment manager telephoned to 
the Unemployment Insurance Office in each of the respective 
districts (the six little jackmen happened to live in six different 
towns) and was told that the checks had not come through yet, 
but that he should advise the men to wait a few days in the hope 
that action would soon be taken. 


On May 19, Mr. Cimino appeared in the office of the industrial 
relations supervisor as the spokesman for the six little jackmen. 
He stated that none of the six men had as yet received any 
unemployment compensation, and that their families were 

In response to this appeal, management held a meeting at 
which the following alternatives were discussed: 

1. To waive the company's right to benefit by unemployment 
compensations and to resume the former policy of paying termination 
benefits to long-service men at the company's expense. 

This suggestion was rejected on the grounds that the company 
had no right to deprive an employee of his legal rights as a citizen. 

2. To extend a temporary loan to these six employees in order to 
tide them over the prolonged waiting period. 

Difficulties with this proposal were as follows: 

a. Such action constituted a technical evasion of the law. 

b. It would be inadvisable to have the employees repay such a 
loan with state unemployment checks. 

c. On the other hand, deferred re-payment would put a great 
responsibility on the employees since they were expected to 
manage both state funds and private benefits. 

d. Finally, deferred re-payments of such a loan would have to 
be made out of the men's wages as soon as employment should 
begin again. This might be quite a strain on the employees' 

3. As another alternative it was finally proposed that the men be 
returned to work and continue to make overshoes for stock, despite 
the fact that such action meant increasing an excessive inventory in 
this product. There was also the difficulty that a few other men would 
have to be rehired to handle the preliminary processes. 


Case 34. The Positive Safety Guard 

(Socially conditioned attitudes on the part of union labor interfered with the 
installation of a foolproof safety device.) 

The punch press department of the National Manufacturing 
Company contained about 40 punch presses of various kinds and, 
on the average, employed about 100 punch press operators (70 men 
and 30 women). The operators worked in three shifts, the first 
shift being the largest. Operators on the first shift started work at 
6:15 a.m. and, with time off for lunch, worked till 3:00 p.m. 
Hours on the second shift were from 3:00 p.m. to 11:30 p.m.; on 
the third, from 11:00 p.m. to 7:00 a.m. 

The punch press, particularly when applied to low-quantity or 
short-run production work, presented a serious accident hazard. 
In all cases, supervision played the most important part in keep- 
ing accidents at a minimum. It was the duty of the supervisors 
to see that presses were properly safeguarded, that the operators 
were properly instructed, and that the safety rules of the company 
were enforced. Each group leader was expected to be a member 
of the safety patrol. It was his duty to see to it that the members 
of his group were "safety-minded" at all times, and that all 
machines had the necessary safety guards. 

For certain types of work, a drop hammer rather than a punch 
press was frequently used, because it was a simpler and cheaper 
machine to operate. The forming operation accomplished in 
this way could also be done on a punch press, but a very large 
press would be required. 

On Jan. 7, 1936, the safety engineer, Mr. Hanson, submitted 
the following report : 

Preliminary Report of an Accident 

Operator: George Winslow, G-50, Badge #855, group leader and die 

Estimated extent of the accident: Loss of first two fingers, left hand above 

second joint. 
Hour of accident: Second shift, 9:20 p.m. 


Machine in use: Drop Hammer #9685. 

Operation: Forming Valve Plates S #615243-0, 673 pieces, 40% com- 

Cause of accident: Defective Machine, and operator's carelessness. 

Summary: Reconstructing the accident as closely as possible without 
contacting the operator, Mr. Winslow was running off a quantity of 
673 valve plates S #615243-0 on Drop Hammer #9685. With the 
work approximately 40% complete, at 9:20 p.m., the weight lever 
that controls the clutch broke off, allowing the hammer to repeat 
when it reached the top of its stroke. Mr. Winslow had been at this 
particular instant placing a piece of work with his fingers, instead 
of using the tweezers, in line with all established rules. When the 
hammer dropped, it cut off two of the first fingers on his left hand. 
The hammer kept on repeating until shut down by another operator. 
It is interesting to note that this man is both a die setter and a 
group-leader. If he had not broken the company rule in regard to 
using tweezers, no serious accident would have occurred. 

I understand from Mr. Bowers, the previous safety engineer, that 
this man had been previously cautioned on several occasions for 
his disregard of company rules, both as practiced by himself, and by 
members of his group. 

During the investigation of this accident, the safety engineer 
found that originally the drop hammer in question had been 
equipped with a "sweep-motion guard." This appliance was 
designed to brush aside the operator's hand whenever the hammer 
was used and the operator failed to withdraw his hand from under 
the die. 

However, the operator had frequently complained of the 
following inconvenience : He would withdraw his hand sufficiently 
to clear the descending die, but not far enough to clear the sweep- 
motion guard, designed to protect him from injury. As a result, 
he would receive a smart rap on his knuckles or wrist. The 
operator regarded this "punishment" as unnecessary and insisted 
that the sweep-motion guard was more of a menace than a 
protection. Therefore, he and his fellow workers repeatedly 
petitioned management to discard the device. After some dis- 
cussion, management agreed, on Jan. 15, 1935, to remove the 
guard, basing its decision on the fact that the operator's hands 
were still being protected through the use of tweezers. Neverthe- 
less, with the automatic safety factor removed, it became abso- 
lutely necessary that the operator should obey instructions as to 
the use of tweezers and under no circumstances put his hands 
under the die. 


As indicated by the Winslow accident, this rule was not always 
obeyed. Operators on incentive work were often tempted to cut 
as many corners as possible in order to increase their output. 
For instance, in the operation of forming valve plates, according 
to regulations based on time and motion studies, the operator 
was required to pick up the unformed valve plate with his left 
hand out of the tray on his left, grip it with the tweezers in his right 
hand, and then insert it in the die recess. He then tripped the 
hammer with his right foot. After the drop hammer had com- 
pleted its cycle, the operator, with his tweezers, removed the 
finished piece from the die recess and tossed it into the tray on his 
right, while at the same time picking up a fresh piece with his 
left hand. He then repeated the cycle of operations. 

In order to gain time over the standard allowance, the operator 
developed the habit of picking up an unformed part with his left 
hand and placing it immediately into the die recess. This motion 
was synchronized with the motion of his right hand, which 
picked up the finished piece with the tweezers, tossing it into the 
tray. In this way he was able to eliminate two motions, speed up 
his production, and increase his earnings. But every time he 
placed his left hand under the die, the operator endangered his 

For some time after the Winslow accident, the safety engineer 
experimented with mechanisms of various kinds that would safe- 
guard this particular type of drop hammer and the punch presses. 
No satisfactory device was found. The drop hammer was 
removed from service, and the work transferred to standard 
punch presses. 

On Apr. 6 and 7, 1936, the safety engineer attended the 
annual New England meeting of the Massachusetts Safety Con- 
ference at the Statler Hotel in Boston. At this meeting he became 
acquainted with the Possons Positive Punch Press Safety Device, 
which was manufactured by the Surty Manufacturing Company, 
Inc., of Chicago, 111. 

According to the prospectus: 

The Possons device provides absolute safety because the operator's 
hands are removed from the danger zone by a Positive action which is 
independent of the personal equation or state of mind of the operator. 
Steel cored cables pull his hands away, and his own carelessness cannot 
cause an accident. 


The following diagram illustrates how the device operates : 

Fig. i. — Possons positive safety device. 

A fellow safety engineer who attended the conference told 
Mr. Hanson that he had just installed 17 of these devices and was 
pleased with the result. An employee in his plant had recently 
lost three fingers, and as a result of this accident the workers were 
particularly "safety conscious " and grateful for the company's 
effort to protect them. 

Although the punch presses at the National Manufacturing 
Company operated on the two-hand trip principle, which seemed 
to provide adequate protection against any accident involving 
injury to hands or fingers, Mr. Hanson was convinced that it was 
worth while to try the new Positive Safety Device. Accordingly, 
on Apr. 22, 1936, at the meeting of the Feeder Section Safety 
Committee, Mr. Hanson called attention to this new safety 
device and explained in detail how it functioned. He urged that 
one such device be installed as an experiment but met with con- 
siderable opposition on the part of Mr. Stahl, the foreman in 
charge of punch presses. This foreman had had some experience 


with the Possons Positive Safety Device at the Newark Plant, 
where two of these devices had been installed. His recollection 
was that management had experienced considerable difficulty in 
getting workmen to operate punch presses that were so equipped. 
In view of the fact that the large Newark punch press department 
had made no further installations of this type of safety device, 
the committee voted against Mr. Hanson's suggestion. 

Following this meeting, Mr. Hanson corresponded with other 
National Manufacturing Company safety engineers, inquiring as 
to their experience with the Positive Safety Device. He found 
that it was used very little. 

The first opportunity for any further constructive work in 
regard to safety mechanisms on punch presses presented itself in 
the following manner : 

On Jan. 28, 1937, at the supervising safety committee meeting, 
Mr. Hanson suggested that glass guards similar to those used on 
tool grinders be developed for spot welder use. This would 
eliminate the need for using goggles, which the workers did not 
like to wear. He sent for samples of this glass guard device to 
the Surty Manufacturing Company, which specializes in safety 
equipment. Instead of sending samples by mail, the Surty 
Manufacturing Company directed its district salesman, Mr. Ches- 
ter, to bring them himself. Mr. Chester visited the plant on 
Feb. 4, 1937. During the conversation, Mr. Chester mentioned 
that he had been responsible for the designing and installation 
of the Positive Safety Device. Mr. Hanson told of his failure 
to get one of these devices installed and solicited his aid. He 
introduced Mr. Chester to Mr. Stahl, the foreman, who had 
hitherto been opposed to the use of this device. He decided to 
give it a trial. The argument used to convince Mr. Stahl was as 
follows : 

Mr. Chester urged that it was in the foreman's interest to give 
the device a trial. This absolute protection was on the market, 
and unless the company gave it a fair trial it would leave itself 
open to the charge of lack of foresight and negligence. If an 
accident occurred and the punch press operators learned that 
such a positive device existed, they might argue that their inter- 
ests had not been properly protected. 

As a result of this discussion, the Positive Safety Device was 
sent for on Feb. 5, 1937. 


In arriving at the decision to experiment with the Positive 
Safety Device, it was not considered advisable to talk the matter 
over with the operators or the union representative. Referring 
to his experience at Newark, the foreman was of the opinion that 
the workers had better not be consulted. He persuaded the 
safety engineer that once the device was installed and the workers 
saw that it provided absolute protection, they would be satisfied. 
To experiment with the safety device, the foreman selected an 
odd-job press that would not interfere with line production. It 
stood near the aisle and had plenty of free space around it to 
permit the installation of the device. 

On Friday, Feb. 26, 1937, the Positive Safety Device was 
installed, and Mr. Stahl notified the safety engineer. Mr. Hanson 
went to the punch press department and gave the device a trial. 
After some final adjustments had been made, he was favorably 
impressed with the functioning of the guard. 

A group leader was asked to try the device. The group leader 
complied, but refused to make any comments. 

Several punch press operators were also invited to try the 
new harness, but declined. Finally, Mr. DaCoste, an elderly 
employee, consented to operate the press. He was of the opinion 
that the device would in no way interfere with his making standard 
time, but he would not agree that he could accomplish more work 
because of it. 

The experiment had not progressed far when Mr. Cameron, 
president of the union, appeared on the scene. Without trying 
the device, Mr. Cameron requested that the mechanism immedi- 
ately be discarded for the following reasons: 

1. The operator could not possibly be expected to submit to the 
"intolerable condition of being chained to his job." 

2. In case of emergency (fire, panic, etc.), the operator would not 
be free to leave the machine. 

3. Being chained to the machine, he could not avoid falling objects 
and so ran considerable risk of being injured. 

4. The bracelet and chain would interfere with the operator's 
motion and make him less efficient. 

5. The device was not actually foolproof, inasmuch as the chain 
might fail to function. 

6. The use of such an automatic device would undo years of training 
with regard to safety. The operators had been cautioned, both by 
their supervisors and leaders, not to put their hands under the die and 
to use tweezers in handling the work. 


7. The worker would be led into forming bad habits. The auto- 
matic device enabled him to put his unprotected hands under the die. 
Then, whenever he was transferred to another machine not similarly 
equipped, he would run the risk of hurting himself. 

8. Finally, the present method of using tweezers and the two-handed 
trip principle was far superior to this new device, since the operator's 
hands were never allowed to go near the die. 

The safety engineer tried to persuade Mr. Cameron that the 
new device should be given a chance by saying that: 

1. Theoretically, the worker was "chained" away from his job and 
not to it, 

2. In emergencies the "hand straps" could be released quickly by 
pressing clips. 

3. There was sufficient slack to the cable to permit the operator to 
move a reasonable distance and to avoid any possible falling objects. 

4. There was no restriction to the worker's movements once the 
device was properly adjusted. 

5. Once the operator became familiar with the device, wear on the 
cable was negligible. Furthermore, periodic inspections would, of 
course, be conducted to check this device as well as any other part of 
the machine. There was no danger, therefore, that the device might 
fail to function. 

6. True, workers were continually cautioned not to put their hands 
under the die, but the Winslow accident was evidence enough that 
such cautions were frequently disregarded. 

7. In the event that the device proved successful, all presses would 
be so equipped. 

8. The Surty Manufacturing Company had demonstrated that this 
new safety device guarded against lost time and was, therefore, more 
efficient than the tweezer and two-handed trip principle. 

Despite all these arguments, Mr. Cameron insisted that the 
workers could not tolerate such a device, and that it must be 

After Mr. Cameron left the department, Mr. Hanson talked to 
the operators (especially to the women) in order to get their 
reactions to the new safety device. They were uniformly of the 
opinion that they would be afraid to put their hands underneath 
the die and that they could handle the work faster by means of 
tweezers. They also asserted that the use of tweezers enabled 
them to place the work better. 

Mr. Hanson allowed the device to remain for three days in the 
hope that the workers might familiarize themselves with it. The 
workers, however, continued to refuse to operate the machine 


to which the device was attached. Furthermore, the president 
of the union insisted that the new contraption be removed. In 
response to this situation, the safety engineer had the new device 
taken away. 

On Mar. 4, 1937, Mr. Chester came to check the safety 
device and to inquire whether it had been found satisfactory. 
When he learned that the device had been removed, he criticized 
Mr. Hanson for not calling on him to "sell the device to the 
workers." Mr. Hanson referred him to the union president. 
Later, Mr. Chester reported that he had not been able to convince 
Mr. Cameron. 

A week later, Mr. Chester appeared once more at the plant 
and stated that his superior had urged him to try again. Mr. 
Hanson suggested a new method of approach: The salesman 
should attempt to convince the union president that this positive 
device was indispensable to the protection of the workers' safety 
and welfare. In order to protect the workers' hands, the president 
was in duty bound to request management to install the new 

After a conference which lasted several hours, Mr. Chester 
returned to the safety engineer's office, thoroughly convinced that 
there was no hope of installing the device. 

On Apr. 28, 1937, at 9:15 p.m. Mrs. Henrietta Perkins lost her 
left thumb and index finger while operating a 2^ Toledo punch 
press. The operator stated that she had some punchings in her 
left hand and was feeding the press with this hand when the 
press repeated and crushed her fingers. She added that "the 
press was acting up since 9 o'clock, but the repairman was so busy 
that I didn't call him." 

At the monthly meeting of the supervising safety committee, 
May 27, 1937, the safety engineer made the following report: 

Henrietta Perkins, Department G-50. Traumatic amputation of left 
thumb and left index finger. 

Mrs Perkins was operating a No. 2^ Toledo punch press equipped 
with air trips. She was performing a bumping operation on rotor 
laminations, and had been working from 2:00 p.m. until the time of the 
accident, which was at 9:15 p.m., at which time she claims the press 
repeated and cut off the thumb and first finger of her left hand. 

In order to reconstruct the cause of the accident, Mr. Hanson 
operated the punch press for over an hour directly after the accident. 
During this time the punch press could not be made to repeat under 


normal operating conditions. Based on the location of the two-hand 
trips, the position of the parts of the fingers under the die, and the 
laminations being handled at the time, the following conclusion was 

Mrs. Perkins must have been feeding the laminations under the 
die with her left hand, holding the left air trip down with her left elbow. 

At a later date, when Mrs. Perkins had sufficiently recovered, 
the accident was reviewed with her, and she then agreed that she 
had been feeding the punchings under the die with her left hand, 
but denied that she had been holding the air trip down with her 
left elbow. She stated, however, that it was possible that her left 
elbow accidentally came in contact with the left-hand air trip. 
She stated, furthermore, that she had been using her tweezers 
in her right hand, but using them only to lock some of the punch- 
ings when they went out of place under the die. 


Case 35. The Fan Case 

(Tension between workers and supervisors brought to a head by the inadequate 
interrelation of departments.) 


Miss Julia Solinsky, union representative. 

Mr. Avery, supervisor, industrial relations. 

Mr. Cameron, president of the union. 

Mr. Lee, superintendent, refrigeration division. 

Mr. Norton, foreman, test department. 

Mr. Hastings, general foreman, refrigeration division. 

On June 23, 1937, Miss Julia Solinsky, representative of the 
winding group, came to the industrial relations office and asked for 

Solinsky: Mr. Avery, when our group was working in A-building we 
always had fans in the summertime. What I want to know is, 
why can't we get some fans now? I've talked to the foreman and 
also to Mr. Lee (superintendent). They both refuse to give us any 
fans. I've also talked to Mr. Cameron (president of the union). 

Avery: Well, Julia, I'll have a talk with Mr. Lee and see what I can do 
for you. 

In the afternoon of that same day, Mr. Cameron came to see 
Mr. Avery. He asked whether anything had been done about 
the fans. Avery replied that he had not yet had an opportunity 
to talk to Mr. Lee but would try to see him that day. 

At four o'clock that afternoon, the union president came again 
to the office of the Industrial Relations Supervisor and told 
Mr. Avery that there was no use in seeing Lee because the latter 
had absolutely refused to give the girls any fans. He had talked 
to Lee just now and "couldn't get to first base." But he was deter- 
mined to take the question up at the next meeting with manage- 
ment. This meeting was to be held on July 2 1 , it being the custom 
to meet on the third Wednesday of every month. Avery tried to 


dissuade him and suggested that he himself should have a talk 
with Mr. Lee before the union president took the matter up at the 
next meeting. 

On June 24, Mr. Avery saw Superintendent Lee and asked 
about the fans. The superintendent was positive in his refusal 
on the grounds that once fans were given to one section, everyone 
in his division would want a fan. He could not afford to add this 
item to his expenses since he was having trouble enough keeping 
his budget in line as it was. 

Mr. Avery reminded the superintendent that the union 
intended to discuss the matter at the next meeting with manage- 
ment, and that he did not like to have the works manager bothered 
with an item of such a petty nature. Mr. Lee, however, was firm 
in his refusal, acting on the belief that he was taking the right 
stand, and that it might be a good thing to have the manager 
know about such foolish requests. 

On June 25, Mr. Avery visited the winding group to investigate 
the problem of ventilation. He found that conditions were 
satisfactory. True, the winding group was the only group in the 
building which was situated along the outer aisle and faced 
windows that were exposed to the glare of the afternoon sun. On 
the other hand, Mr. Lee had purchased Venetian blinds and 
installed them in each window so that it was possible to keep out 
the sun without shutting out the air. He spoke to Julia. 

Avery: Julia, I had a talk with Mr. Lee and he doesn't feel that condi- 
tions here justify the installation of fans. There seems to be 
plenty of ventilation. I notice he has bought blinds for you to 
keep out the glare of the sun. After all, Julia, we have to be care- 
ful not to establish a precedent. What I mean by that is, we 
can't afford to give everybody a fan. It's very likely that once 
we put a few fans here, other groups will want them, too. 

Solinsky: Well, we had fans in A- 14 and never had any trouble getting 
them. Look at these girls, Mr. Avery. If you had this job you 
would want some relief from the heat, too. These girls have to 
stand here, all day, winding these motors and they get pretty 
tired. Our job is a lot harder than the work over across the aisle 
in the glass house. 1 Them people over there have all got air 
conditioning. I think it's pretty cheap of the company. After 
all, we make fans here, so it wouldn't cost anything. I think Lee 
is a cheap skate, if you ask me. And, believe me, if he doesn't 
1 The final assembly and inspection of the delicate refrigerator compressor unit 

were carried out in a large, glass-enclosed, air-conditioned, dust-proof room which 

was known as the "glass house." 


give us fans he'll hear about it from the union. We're going to 
put it in our paper and tell all about the air conditioning he's 
putting in his own office. 
Avery: Now, don't let's get excited. That sort of thing doesn't do 
anybody any good. I'm sure this will work out. I'll keep after 
Mr. Lee and see what I can do. 

On June 25, Mr. Norton, the test foreman, asked several of the 
manufacturing department heads for locations in which to place a 
number of fans for a test run. The inspectors wanted to place 
the fans among working groups because they wanted to get the 
reactions of different people to a new type of fan. 

Mr. Lee thought that the placement of a few fans for a two 
weeks' test run offered a good opportunity to satisfy the complain- 
ing winding group and asked for six fans. These were placed at 
convenient stations near the aisle. No explanation was given. 
The girls were delighted. 

On Friday, July 9, 1937, Mr. Hastings, the general foreman of 
the refrigerator section, dropped into the office of the industrial 
relations supervisor about 9 :oo a.m. 

Hastings : Pretty warm today, Avery. Some of my girls on the wind- 
ing job are already asking if they could go home. Nothing very 
serious yet, but if it gets much hotter, I'm afraid they'll all want 
to leave. You ought to take a walk out there and look 'em over. 
You'd think the girls are staging a floor show. They're wearing 
bathing suits, sun suits, and shorts, trying to keep cool. And 
there are some pretty nice backs in that group. I notice that 
anybody who can think up an excuse to go into J-building has been 
there to take a peek. 

Avery: Is that so? Better look out there won't be any spontaneous 

At 1 1 :oo a.m. that same day, Mr. Hastings came again into the 

Hastings: I'm afraid I can't hold the girls much longer. They're all 
demanding that we give them the rest of the day off. They say 
it's too hot to work. 

Avery: Well, they've only got about three hours left on this shift, and I 
hate to see 'em go out because of the effect it might have on the 
rest of the building. We need that production pretty badly. 
Jolly them along and try to keep them at work. You've got some 
fans out there, haven't you? 


Hastings: I should hope to tell you. The boss had six of them placed 
along the aisle. But even they don't do much good on a day like 

Avery: I'll tell you what we'll do. I'll take a walk out into the plant 
the next half hour and look the situation over. 

The operators on the first shift had their lunch period from 
10:45 to 11:30 a.m. Most operators left the shop during this 
period. While they were away, men came and removed all the 
fans. The few workers who had remained inside the shop were 
indignant. As other operators returned there was quite a hubbub. 
The winding group especially, was complaining vigorously, some 
of its members threatening to stage a sit-down strike. 

At n 135, Mr. Avery went out into the plant and walked over 
to the winding group to see what all the commotion was about. 
He talked to several of the girls, especially the representative, 
Miss Solinsky. 

Avery: What seems to be the trouble? Where are all those fans that 
are supposed to be here? 

Solinsky: Where are all the fans, indeed I I don't know. Don't ask 
me. They just grabbed them off us half an hour ago. We had 
six of 'em right on the line. Now I ask you, isn't that a nice 
example of how this fellow Lee does things? Just because we 
asked for time off, he gets sore and pulls all the fans away from 
here. I think he's the hardest man to work for there ever was. 
I don't know where the fans are. All I know is that the sorehead 
probably got mad because the union overruled him when we asked 
for fans a couple of weeks ago, and he refused. But let me tell 
you, Mr Avery, he can't get away with this. 

Avery: Who took the fans away, Julia? 

Solinsky: I don't know who they were, Mr. Avery. One of the girls 
said they were just three fellows. . . . and shortly after 11, they 
came along, calmly picked up the fans, and made off with them. 
I don't know just where they are now, but I bet that guy, Lee, 
has got them hidden somewhere. 

Avery: Well, you just wait a minute, Julia. There must be some mis- 
take. I'll look into this right away. You tell the girls to calm 

Avery called up Mr. Swanson, general foreman of the fan 
division, and asked to have some fans put into the winding group 
at once. Mr. Swanson agreed. He then told Miss Solinsky that 
the fans were on the way. Miss Solinsky and the girls were 


Avery then went to the superintendent's office, but Mr. Lee 
was not there. Mr. Hastings, the general foreman, was in charge. 

Avery: Ed, I thought you told me there were six fans out on the winding 

Hastings: Well, there are, aren't there? 
Avery: They weren't there five minutes ago. Julia tells me that 

somebody took them away, and the girls blame Lee. 
Hastings: For God's sake! Come on, let's go out there. 
Avery: Oh well, there's no hurry. I think they are all right now. 

What I want to find out is who took the fans away? 
Hastings: I don't know. Let me call up Norton. 

The general foreman called Norton on the telephone and 
asked him to come over to the superintendent's office. After 
Mr. Norton arrived, both Hastings and Avery asked whether he 
knew anything about the fans that had been placed in the winding 
section by the test men. 

Norton: Sure thing. We got 'em in the lab. now. The boys are 
tearing them down for a checkup on the test run. The two weeks 
are up, you know. 

Avery: Well, for God's sake, Bill, it's too bad you had to pick the 
hottest day of the year to take the fans out of the department. 
All the girls over there are blaming the general foreman and the 
superintendent for taking the fans out at this time. It's about 
100 degrees out on the winding job, and these were the only fans 
the girls had. We've been trying to keep 'em at work all day, 
and you come along and pull the props from under us. 

Norton: Well, hell's bells, fellows, you've got to be reasonable. These 
fans weren't given to the department. They were just out there 
on a two weeks' test run. Lee had nothing to do with taking 
them away. 

Avery: True enough, but these people don't know it. All they know is 
that they had fans and that they were taken away. I tell you 
they were almost ready to stage a fanny strike. 

Norton: Well, what d'you expect me to do about it? The fans are 
up in the test lab. now, being checked over. I can't put 'em back. 

Avery: O.K. Only next time tell a fellow, will you? 

City Temperatures 1 

Official temperatures recorded half-hourly Thursday and yesterday 
at Observatory follow : 

1 Clipping from the Times Union, Saturday, July 10, 1937. 




9:00 A.M. 


12:00 NOON 
12:30 P.M. 



























Yesterday Cooler than on Thursday but Felt Hotter 1 

official temperature 97, with thursday's mark 98. humidity 
blamed for discomfort during day 

Officially it was cooler yesterday than Thursday, by a single 
degree, but it seemed hotter, and as usual, the humidity was blamed. 
Yesterday the Observatory maximum was 97; Thursday it was 98. 
Yesterday the humidity passed the 90 per cent mark; Thursday it went 
little higher than 40. The continuation of the heat wave was marked 
by a general slump in public good humor. . . . 

1 Clipping from the Town Record, Saturday, July 10, 1937. 


Case 36. The Suggestion Plan at the National 
Manufacturing Company, Inc. 

In general, suggestion plans are intended to promote construc- 
tive thinking and cooperation of employees. Since their inception 
in the i88o's, suggestion plans have spread rapidly in the United 
States, both in private industry and in public organizations. 
They have much in common with employee representation plans 
and serve chiefly as an additional channel of communication 
between workers and management. For, whatever the economic 
worth of the ideas suggested (80 per cent or more are usually 
insignificant in this respect) , the systems are believed to have real 
social and educational value. 

To management, the plan may reveal able employees for 
promotion. It has been found, for instance, that the absolute 
number of suggestions is always larger than the number of con- 
tributing individuals. There tends to be a small group of men 
who are prolific with ideas. The suggestion plan, then, acts as a 
mechanism of selection. 

The workers are expected to profit by receiving recognition 
for creative effort, both from management in the form of monetary 
rewards and opportunities for advancement, and from their 
fellow workers in the form of prestige. 

If suggestions are not restricted, the suggestion plan may also 
provide a constructive outlet for complaints. 

At the National Manufacturing Company, a suggestion plan 
had been in operation since Oct. 3, 1924. At that time, and up to 
June, 1932, the method of administration was simple. Sugges- 
tions handed in by the employees were considered by a committee, 
and, if accepted, suitable awards were made. Notice of awards 
was posted publicly on the bulletin boards in order to stimulate 
further suggestions and give the suggesters full recognition. 



However, the public posting of awards met with increasing 
dissatisfaction on the part of the workers. Some of the reasons 
given were as follows : 

i . If a worker was rewarded for a suggestion that involved elimina- 
tion of other operators, these operators were likely to penalize the 

2. Similar reactions resulted if a suggestion so simplified or changed 
a work routine that rate revisions became necessary. 

3. A foreman might discriminate against workers who had turned in 
suggestions improving processes for which the foreman himself was 
responsible. He tended to interpret such suggestions as criticisms of 
his work, and he either penalized the worker or tried to rearrange the 
process in such a way that the suggestion was no longer of value. 
Naturally, antagonism developed. 

4. Many disputes arose as to the distribution of the windfall when 
an award was made. If the suggester owed money, claimants would 
appear and ask the company to effect a settlement. 

Because of these complaints, management decided to publish 
awards by code number only, thus preserving the suggester's 

The general company policy with regard to the suggestion 
system was stated in the following letter from the works manager's 
office, dated Apr. 1, 1935. 

To All Supervisors and Employees: 
Subject: Suggestion System 

1. The Company invites any suggestion which any employee 
believes will help improve our quality, methods, design or opera- 
tion, reduce cost of manufactured products, or betterment of any 
phase of routine or processes in the conduct of the business or 
otherwise advance our mutual interests. 

2. All accepted suggestions will be paid [the equivalent of] the 
first month's direct labor saving, varying in amount, dependent 
on annual activity. In cases where an award cannot be 
computed by this method, the Suggestion Committee will 
determine a fair award. 

We have had subjects drawn to our attention in which sug- 
gestions have, after a time, proven to be exceptionally valuable, 
and for which the awards made previously have seemed inadequate. 
We do not hesitate, in such cases, to re-value these suggestions. 

3. A suggestion is a direct negotiation between the suggester 
and the Suggestion Committee. Therefore, it is not necessary to 
consult your superior nor obtain anyone's permission before sub- 
mitting an idea. All suggestions are confidentially handled. 

4. All employees throughout the works and offices are eligible 
to submit suggestions. Superintendents, Foremen, Engineers 


under patent agreement, Ratemen, Inspectors, Draftsmen, Cost 
and Production Clerks may submit suggestions on matters out- 
side their line of duty. Any question as to a suggester's eligibility 
will be decided by the Suggestion Committee. 

Signed: Works Manager 

The suggestion committee, with the exception of two employee 
representatives, was appointed by the works manager. The 
employee representatives were nominated by the union and 
approved by the works manager. One employee representative 
was selected from the refrigeration division, the other from the 
motored appliances division. 

The company's safety engineer served as chairman and secre- 
tary of the committee. As indicated by his title, safety work was 
his primary duty, and in the capacity of safety engineer he 
made regular rounds through the plant. On these occasions, 
in the capacity of secretary of the committee, he could easily be 
approached by an employee without anyone's knowing just 
what they were talking about. Very often an employee had a 
suggestion in mind but could not quite express himself or make a 
satisfactory sketch. Under these circumstances, the secretary 
helped the employee to express or elaborate the suggestion in a 
form suitable for submission to the committee. 

Another member of the committee was the supervisor of the 
works-system department. In the latter capacity, he had natu- 
rally a wide acquaintance with plant conditions and could quickly 
make a preliminary evaluation of any suggestion that came up for 
consideration. The other three management representatives on 
the committee came from the three basic divisions of the plant 
(refrigeration division, feeder division, and motored appliances 
division). Each one was qualified to evaluate the incoming 
suggestions from the point of view of his own particular experience. 

Every Friday evening, the secretary made the rounds of the 
suggestion boxes, which were distributed throughout the plant, 
and collected the suggestions that had been submitted. Many 
suggestions were also sent to his office by mail. These were 
attended to daily. Otherwise, at the beginning of each week, the 
secretary, assisted by a stenographer, classified and dated the 
suggestions received on Friday of the preceding week. Duplicate 
copies, identified by code number, were made of each suggestion, 
and a receipt was sent to the suggester. 


One copy of the suggestion was placed on file; the other was 
assigned to an investigator who, in most cases, was a department 
head. The department head, in turn, was apt to delegate the 
investigation to someone else, usually the foreman. It was hoped 
that the investigation would be made within two or three days, 
but usually much more time elapsed before the suggestion was 
returned. In fact, many workers complained that some foremen 
allowed suggestions to pile up on their desks and then considered 
a number of them all at once without giving them adequate 
individual attention. The secretary of the suggestion committee 
tried to make it a general rule that three weeks should be con- 
sidered the dead line for investigation. But, if more time was 
taken, he had no disciplinary authority. The only way he had of 
securing prompt consideration was to send out a personal appeal. 

The suggestion committee met at least once a month and, if 
necessary, once a week. On Wednesday of each week in which 
they met the committee considered all suggestions in the open 
file. Ninety-five per cent of the cases in the open file were usually 
settled at each meeting. 

A suggestion could be accepted or rejected only by unanimous 
consent. Any dissent held up the suggestion for further investiga- 
tion. The following were typical reasons for further investigation : 

i. Foreman had sent in an incomplete report. 

2. Suggestion had value but required further study from the point 
of view of its practical application. 

3. Suggestion definitely improved production process but required 
equipment that was at the time too expensive to install. 

4. There was lack of agreement as to a suggester's eligibility, i.e. f 
whether the suggestion in question was outside his line of duty. 

If a suggestion was accepted, a recommendation was sent to 
the works manager that an award be given. No award was ever 
made until a suggestion had actually been put into operation. 
Notices of all awards were sent out by Friday, if possible. 

Many suggestions referred to conveniences and small improve- 
ments of such a nature that no direct labor saving could be 
calculated. Proposals of this nature were regarded as minor 
suggestions and, if accepted, were rewarded uniformly by a 
payment of $2.50. 

As an added incentive to make suggestions, an additional $5 
was paid for the first five accepted suggestions from one employee. 

Table XII 




Adopted (A) 

Per cent adopted 

Additional awards made 

Amount paid, regular awards*. 

Amount paid, additional awards 

Total regular and additional awards (B) 

Average amount regular awards 

Average award per suggestion, including 
additional awards, divide (B) by (A) . 






































Table XIII 

Suggestions Adopted and Regular Awards Paid 

113 at $2.50 $282.50 

2 at 3 . 00 6 . 00 

1 at 4 . 00 4 . 00 

75 at 5.00 375-00 

1 at 6.00 6.00 

12 at 10.00 120.00 

1 at 13.00 13.00 

6 at 1 5 . 00 90 . 00 

1 at 17.50 17.50 

1 at 20.00 20.00 

3 at 25.00 75.oo 

1 at 33.00 33.00 

1 at 35.00 35.00 

1 at 45 . 00 45 • 00 

4 at 50 . 00 200 . 00 

1 at 75.00 75-oo 

1 at 150.00 150.00 

1 at 192 .00 192 .00 

1 at 200 .00 200 . 00 

Total 227 $1,939.00 

Additional Awards Paid 

14 at $5 . 00 $70 . 00 

2 at 10.00 20.00 

2 at 15.00 30.00 

3 at 20.00 60.00 

1 at 25.00 25.00 

1 at 30 . 00 30 . 00 

2 at 45.00 90.00 

1 at 50.00 50.00 

Total 26 $375.00 

Ten dollars additional was given for the first ten accepted sug- 
gestions, and so on up to $50, when the sequence began all over 

If a suggestion was rejected, the suggester was notified upon 
a form provided for that purpose giving the reasons why the 


suggestion could not be accepted. Usually the secretary made a 
personal visit in such cases, thanking the suggester for his interest 
and encouraging him to submit other suggestions. Whenever 
possible, the secretary tried to find something of a complimentary 
nature that could be said about the rejected suggestion. For 
instance, the suggestion might have been accompanied by an 
exceptionally clear and well-executed drawing which he could 

Table XII gives a summary of suggestion activities for the 
period 192 5-1 93 5. Table XIII is an analysis of the number of 
suggestions adopted in 1935 and the awards paid during the same 

The attitudes of employees toward the suggestion system were 
divided. Many of them cooperated wholeheartedly with the 
system, as can be seen from the increase in number of suggestions 
sent to the committee during the years 1933, 1934, and 1935, when 
the numbers of all people employed at the plant were 2,985, 
4,546, and 4,237. On the other hand, many workers would have 
nothing to do with the system. Some of these workers were 
previous contributors. Various reasons for dislike of the sugges- 
tion system were as follows: 

1. Some employees continued to fear criticism from their fellow 
workers if they made suggestions that might have a bearing on the 
elimination of certain labor operations which would affect one or more 
of their fellows. Representative of this state of mind was the follow- 
ing letter from an employee to the secretary of the suggestion 


I have a suggestion to make that will save 
much time and money 

I would like to have this suggestion investigated 

privately, like on a Saturday morning, so as not to create 

any hard feelings between my fellow workers. 

Yours truly, 

2. Some workers were of the opinion that the administration of the 
suggestion system was too much a matter of routine and did not 
provide sufficient personal contact between the investigator and the 


3. Some workers thought that the period of waiting between sub- 
mission of a suggestion and its disposal was too long. They frequently 
became indifferent. 

4. Many workers were of the opinion that an award of $2.50 for 
a minor suggestion hardly repaid them for the trouble of filling out the 
necessary form. 

5. There was a tendency for workers to feel that while management 
was perfectly willing to make small awards, it showed extreme reluc- 
tance to pay out sums larger than $5 or $10. In those cases where a 
comparatively large award (between $150 and $200) had been involved, 
there had usually been much debate as to the suggester's eligibility. 
This question was indeed troublesome. A valuable labor saving sug- 
gestion usually involved specialized knowledge such as only leading 
hands and regular supervisors possessed. Naturally, in cases of this 
kind the question of whether or not the proposed suggestion was 
"outside their line of duty" became very important. 

The supervisors also were divided in their attitudes toward 
the suggestion system. A discussion among supervisors brought 
out the following reactions : 

Several supervisors contended that the foreman should be 
informed whenever a worker in his department made a suggestion, 
because in some cases it was necessary to talk over the suggestion 
in order to understand the idea correctly. The foreman could 
assist the suggester in elaborating upon his idea and making it 
worth while. Also, some supervisors believed that in this way 
the foreman could find out who were the outstanding employees 
in his department. 

Other supervisors were firm in their belief that the foreman 
should not know the suggester's name because friction and dis- 
crimination against the suggester would probably result. The 
foreman might regard suggestions as a reflection upon him for not 
having made the designated improvements himself. He might 
feel that he was being subjected to criticism. 

If an employee wished to have his identity known, it .was 
suggested that the chairman of the suggestion committee should 
inform the highest supervisor in the employee's department that 
the employee had shown initiative by making a suggestion. 
This supervisor should inform the foreman. It was thought that 
a conflict of personalities might be avoided if two supervisors in 
the department knew about the enterprising employee. 


Case 37. The Veterans' Association 

(Interference between social organization and company vacation policy.) 

This organization was started in 1914 at the central plant 
of the National Manufacturing Company for the benefit of long- 
service employees. It was specifically stated that the organiza- 
tion was not a pension or an insurance plan, but was designed to 
" promote a spirit of fraternalism and sociability and to perpetu- 
ate friendships gained by daily business association." Employees 
working in subsidiary company plants were cordially invited to 
form branch organizations. Qualifications of membership were 
as follows: All employees with 20 years or more of service, con- 
tinuous or cumulative, could apply to the central office for certifi- 
cation. Dues for membership were $2.50 a year. In addition 
to this, each veteran employee was to pay for a membership pin. 
One of the benefits to be derived from joining the association, 
(aside from the opportunity for social relationships), was a week's 
vacation with pay. This was in addition to the week's vacation 
with pay which the company granted to all its employees on the 
check roll who had 10 years or more of service. 

One of the New England works of the National Manufacturing 
Company enrolled 68 members in the Veterans' Association. The 
local branch, however, had no facilities for social gatherings and, 
aside from a few organizational rallies and an annual business 
meeting, made no attempts to bring its members together. It 
was generally understood that eligible employees joined during 
the summer period for the purpose of securing an extra week's 

On Feb. 1, 1937, the president of the National Manufacturing 
Company announced a new vacation policy : 

February 1, 1937 ' 
President's Letter No. 215 
Vacation Plan 1937. 

The vacation plan for hourly paid employees of the National 
Manufacturing Company and subsidiary companies for 1937 is 
as follows: 



5-10 years' total service 1 week with pay. 

10 years' total service and over 2 weeks with pay. 

Former employees upon reemployment must have at least 
one year's continuous service to be eligible for vacations under 
this plan. Payments will be calculated as heretofore. 

The vacation plan for salaried employees will be the same as 
for 1936. 

Scheduling of vacations will be arranged to best meet the 
activities of the department. 

L. B. Oliver 

This plan superseded any previous arrangements and dis- 
continued the practice of granting veteran employees an extra 
week's vacation. When this change in policy became known, the 
secretary of the local Veterans' Association came to Mr. Avery 
(supervisor of industrial relations) and wanted to know what 
advantage there was for veteran employees to continue member- 
ship in the association. Many members had complained that 
they felt cheated. He asked the industrial relations supervisor 
to give this question some thought and specifically to consider the 
following suggestions : 

1. That each veteran employee should be granted a third week's 
vacation with pay. 

2. If the first suggestion met with refusal, that each veteran 
employee should be given an annual gratuity to cover vacation 

3. If either of the above suggestions were not acceptable, that 
members of the Veterans' Association should be treated to an annual 
banquet at the company's expense. 

4. Or, finally, that the company should reimburse each member of 
the association the money paid for dues and membership pin. 


Case 38. Case of Anton Palacek 

(Company's attempt to rehabilitate an employee who had lost four fingers.) 

On Apr. 4, 1932, Anton Palacek, nineteen years of age, was 
employed by the National Manufacturing Company as a bench 
hand in the domestic appliances department. He was working 
on the second shift, operating an old-type E. P. hand miller 4050, 
slotting control brackets. A piece of work jammed itself in the 
machine, and, in order to free it, Anton removed the guard on 
top of the cutter. Then, at about 3:30 p.m., Anton tried the 
machine without having replaced the guard, accidentally put his 
right hand under the cutter and cut off four ringers on his right 

The company doctor attended to the injury and, beginning 
Apr. 4, 1932, Anton received a weekly compensation allowance. 

After the accident, Anton assumed the attitude that he was 
ruined for life. His ambition had been to take the civil service 
examination and qualify himself as a policeman, even though his 
education extended only to one year high school. His injury 
shattered this dream. 

In an effort to rehabilitate Palacek, the employment manager 
gave him a job in the employment office as file clerk — running 
errands, filing badges, etc. Anton took no interest in the job 
and failed miserably. He resented the solicitude of women 
clerks in the department and became morose and uncooperative. 

To remedy the situation, the employment manager found him 
a job as general shop clerk. Anton reacted favorably to this 
change for a few days and then failed again. He spent more and 
more time visiting in different departments, exhibiting his injured 
hand and bemoaning his fate. 

The employment manager continued to offer his help and 
endeavored to reawaken the young man's ambition. "Other 
people had similar accidents but had spirit enough to stand up and 



make something of themselves. " He pointed out opportunities 
in different trades and finally interested the boy in studying to 
become a draftsman. Since Anton was deficient in schooling, 
the employment manager arranged with his superiors that the 
young man could study draftsmanship at the local trade school 
in the morning and work for the company during the afternoon. 

Again Anton responded favorably for a short time. Then he 
began to slip. He complained that he was not earning money 
enough even though the company paid the difference between his 
regular wages and the amount of his compensation. 

On Nov. 8, 1933, Anton's case was brought before the Indus- 
trial Accidents Commission. He was represented by two lawyers 
who argued that the company should settle the case by paying 
Palacek a lump sum. The commissioner, who took a lively 
interest in the boy's future, ruled that it was better to accept 
the National Manufacturing Company's offer to rehabilitate 
Anton by training him as a draftsman. As a result, Anton was 
placed under the care of Mr. Bowers, chief draftsman, domestic 
appliances engineering department. The following is a copy of 
the Rehabilitation Progress Report that was submitted to the 
commissioner on Jan. 14, 1936. 

Report of Progress in the Rehabilitation 
Anton Palacek 

Purpose: The purpose of this report is to show the progress of Anton 
Palacek as an apprentice draftsman in the Domestic Appliances Draft- 
ing Department. 

This case in the writer's opinion should be broken down into five 
general periods, namely: 

1. Scholastic 

2. Pre-accident employment 

3. Accident 

4. Re-habilitation 

5. Future. 

I am not entirely familiar with the first three periods or, as a matter 
of fact, with the early history of the third period, therefore, I will con- 
fine myself more or less to the fourth and fifth periods. 

In June, 1934, Mr. Kendricks, Supervisor of Employment and Relief 
Department, discussed the case of one Anton Palacek who had been on 
compensation list for a period of time due to an accident, while working 
on a hand miller, which caused the total loss of three fingers and a por- 
tion of the index finger on his right hand. 


For sake of clarity we will list some of the re-habilitation schemes 
tried previous to this discussion: 

Employment Office — acting as a file clerk 

Employment Office — General clerk 

General all around shop clerk. 

It was my understanding at that time that Anton had failed miser- 
ably in each of these projects; however, Mr. Kendricks still thought 
that the boy should have every consideration before giving up his case 

There was another angle of the situation which did not help matters 
any, and that was that some outside influence was working on Anton, 
and he was becoming convinced that he was not getting a fair deal by 
the company. He felt that he should receive his compensation adjust- 
ment in full, it being his contention that he could start in some business 
such as chicken raising. 

Mr. Kendricks decided, after due deliberation, that, inasmuch as 
Anton was at that time more or less of a shiftless nature, the money 
would be spent, and Anton would be out of both his money and a job 
and therefore a burden not only to his family but to society in general. 

It was at this point of the discussion that Mr. Kendricks asked me 
if I thought Anton would possibly be able to do anything in the Domes- 
tic Appliances Drafting Depratment. With the facts as stated above 
before me and the thought of Anton's maimed hand, and by the way, 
he is right handed, I was somewhat reluctant to go ahead without 
first having a talk with Anton. 

Mr. Kendricks arranged this meeting, and we outlined our plans to 
Anton. I must admit that after a short discussion my opinion of 
Anton's chances for success were not very bright; he was all that had 
been said about him, almost to the point of repulsiveness; however, 
I decided to try him. 

From here on it must be remembered that Anton was entirely with- 
out experience in the drafting line. 

Realizing that first of all it would be necessary to decide whether 
or not he could use his right hand I started Anton on lettering with ink. 
He soon became discouraged, but, at that, it really was a difficult 
assignment for him. I explained to him, however, that it was a battle 
that he must fight and win over himself, as there was no one that could 
help him until he had overcome his own deficiencies both physical and 
mental, especially the mental. 

After a while he started to get himself in line and did fairly good 
lettering and tracing of simple details. This kept up for a few months 
with a noticeable improvement as each successive job was completed. 

It happened that one of the other departments needed a man to do 
some minor work, and, thinking this might make Anton feel better, I 
suggested that he be given the opportunity. This was done, and I did 
not hear anything except that things were going "all right" until the 
Chief Draftsman of the other department came and told me that he had 
just been before the Commissioner with Anton and Mr. Kendricks, and 


that Anton was being given a three months' probation, and that it 
would be necessary to appear before the Commission for a decision at 
the end of this time. He also told me that he was disgusted with 
Anton's behavior, and as far as he was concerned he had gone the limit 
with Anton and was ready to turn him out. He explained that Anton 
had for some reason or other fallen back into his old habits and spent 
most of his time hanging around various shop departments. 

I was indeed surprised to hear this and immediately had a serious 
talk with Anton. I told him that I was very much surprised and dis- 
appointed in his behavior. He explained that in the other department 
he had lost interest and become discouraged as to the chances for his 

It was then that I outlined three general paths that lay before him 
for consideration not necessarily for the present but figuring at the 
age of forty. 

First — He could be paid in full, and in a short time the money would 
be gone, and he would be more or less a burden on everyone concerned. 

Second — He could be satisfied with some kind of a minor clerical job 
in the shop with little chance for advancement, as he was more or less 
under a cloud due to his past record. 

Third — He could go to school and procure the fundamental knowl- 
edge necessary in the drafting line, and this, along with a consistent 
and sincere effort here, would put him into a position that at the age of 
40 he could be earning far more than he could if he had never received 
his injury. 

After this discussion I told him to go home and think the thing over, 
and we would make a decision the next morning. 

The next morning Anton came in and said he had decided, if he 
could, to go along with the third consideration, namely, to stay in the 
drafting game. 

We then made arrangements with the Trade School for Anton to 
take mathematics and elementary drawing and here at the plant we 
would keep him on tracing and odd job detailing. 

Since that time there has been quite a change in Anton's all around 
behavior. He has knuckled right down to his work both here and at 
school and I predict, if he still keeps his good work, that eventually 
he will become a good draftsman. 

(s) T. S. Bowers 

On July 13, 1937, Anton Palacek started work as a junior 
draftsman. Frequent comparisons with fellow workers who were 
not similarly handicapped brought on fits of despair and an 
increasing number of periods when Anton would relapse into his 
earlier attitudes of brooding and self-pity. 

Case 39. Case of George Monnier 

(Social complications in a "lame-back" case.) 

On May 21, 1937, at 6:30 a.m., Mr. Monnier, a welder in the 
maintenance department was lifting a welding template from the 
floor onto the welding bench when he complained that this exertion 
had strained his back above the left hip. He reported to the 
foreman who gave him a hospital slip and sent him over to the 
first aid department. The first aid nurse administered a bake 
under the heat lamp. This relieved the pain somewhat, and the 
man returned to work. He was given light duty for the rest of the 

Monday, May 24, 1937, Mr. Monnier did not report for work. 
Mr. Hanson, the safety engineer, investigated the accident and in 
talking over the job with the foreman, could find nothing unusual. 
The template was a steel plate, approximately three by four feet, 
and weighing 90 lbs. The welding bench was the standard height 
of 30 inches. In lifting the plate onto the bench, the plate was 
rested against the bench, lifted upward, and then slid onto the 
bench top. In doing this, the operator lifted only part of the 
weight. This operation had been performed by Mr. Monnier 
several times during the last two or three weeks when he was 
working on the job. The foreman further emphasized that all 
men were instructed not to lift any heavy weight without the 
assistance of another employee. Since the men in the main- 
tenance department worked on a straight daywork basis, there 
were always men around who could lend a hand when help was 

As nothing was heard from Mr. Monnier during the day, 
Mr. Hanson went to his house to inquire why he had not reported 
for work. Mr. Monnier was not at home. His wife stated that 
he had taken the automobile downtown on some business but 
could be expected back any minute. Mr. Hanson could not wait 
but instructed Mrs. Monnier to have her husband report to the 
first aid department as soon as he reached home. 



Mr. Monnier did not come to the first aid department that day, 
but the next day he drove his car into the company yard near the 
first aid department, and seeming to have great difficulty in 
getting out and holding his side, he walked over to the first aid 
department very slowly and in a stooping position. Before 
leaving, he came to see Mr. Hanson. 

Monnier: I am sorry I was out the other day, Mr. Hanson, but it was 
very important that I go downtown on some business. 

Hanson: If my back were as bad as yours appears to be, Mr. Monnier, 
I certainly would go to the hospital as soon as possible and have 
it properly attended to. 

Monnier: That's all right. My wife has been taking care of my back, 
and the electric bakes I get from the nurse here do me more good 
than anything they could do for me at the hospital. 

Hanson: Really, Mr. Monnier, I think you have the wrong idea of 
how a bad back strain should be taken care of. There is a pre- 
scribed method for back injuries that will produce good results 
within two or three weeks. I strongly urge you to see the doctor 
immediately and go to the hospital at once if he advises you to. 

Monnier: I don't think that will be necessary, as the treatment I am 
receiving from my wife and from the nurse seem to be fixing me 
up all right. 

Hanson : My dear fellow, from the way you are walking, you have the 
worst back case I've ever seen in the plant. And I don't think 
you should take any chances. Take my advice, see the doctor 
and get proper treatment at once. I am sure that after two or 
three weeks in the hospital you'll come out a new man, all ready to 
go back to work. 

Monnier: I really don't think there's any need of my going to the 
hospital but I assure you that if the present treatments haven't 
fixed me up by Wednesday, I will go to the hospital for treatment. 
You see, I have a wife and a little baby and they don't like to be 
left alone at nights. 

Hanson: I don't think that is a point to consider at this time. You 
state that you are physically unfit to go to work and they depend 
on you for their livelihood. Under these circumstances it is your 
duty to get well as quickly as possible so that you can return to 

Monnier: I agree with you, but I feel that if you will give me till 
Wednesday, I will have improved enough so that I won't have to 
go to the hospital. 

Nothing was heard from Mr. Monnier for a whole week. 
During this time information drifted in from unsolicited sources 
in Mr. Monnier's department that he spent most of his time at the 


race track and had no more lame back than any of the other men 
who were still at work. 

An interviewer in the employment department had been 
walking along Main Street one evening with his wife, when he 
noticed Mr. Monnier leaning comfortably against a building, 
talking to three other men. The interviewer stopped and talked 
to Monnier. Immediately, Mr. Monnier assumed a position 
indicative of a bad back. 

On another occasion, Mr. Monnier was outside the plant 
watching a salesman give a demonstration with some automobile 
polish. During the demonstration, Mr. Monnier tried some of the 
polish on his own car. While he applied the polish he was bending 
and stretching in a normal manner. Midway through this 
procedure, Mr. Avery, supervisor of industrial relations, happened 
to pass by. He stopped and said: " Better look out for that back, 
Monnier." The invalid immediately placed his hand on his 
back and assumed a rigid position. 

On June 2, 1937, Mr. Monnier came to Hanson's office after 
he had his back baked and started in to tell Hanson how much his 
back had improved. He suggested that if he had a belt for his 
back he would be able to return to work in a week or two. He 
said that he had been talking to a fellow who had a similar affliction 
and had received much benefit from such a belt. 

Mr. Hanson quoted to Mr. Monnier several of the reports 
regarding his actions and asked for an explanation. Mr. Monnier 
answered that such talk was merely prompted by jealousy on the 
part of the men working in his department. He said they "was 
a bunch of Polacks in that department who would cut any man's 
throat without an excuse, and that he ought to know when his 
own back was sore." 

Hanson : You will recall that you promised on May 24 when I saw you 

last that if your back was still bad by the 26th you would go to the 

hospital for treatment. 
Monnier: I know I did, but I don't want to go to the hospital. I've 

been there once for a bad operation and anyone who has been to 

the hospital once never wants to go back again. 
Hanson : That is not the reason you gave me last time we talked about 

it. Then you disliked to go because of your wife and child. 
Monnier: Well, that's another thing, too, and all the more reason 

why I shouldn't go to the hospital. My wife gets scared when 

there is a thunderstorm and has to have somebody with her. 


Hanson: Well, as far as I am concerned, Mr. Monnier, I wash my hands 
of your case. We made an agreement that you would do some- 
thing for me, and you did not make the slightest attempt to live 
up to it. As far as I am concerned, you have put a fast one over 
on me and that's that. Here's the address of the Industrial 
Insurance Company, and if you want to talk over the question of 
a belt for your back or anything else before you are ready to come 
back to work, I suggest that you go down to see them. 

Monnier: I knew you thought I was bluffing from the way you was 
acting. And I'm not going to take that from you. I know my 
rights. I'm going over to the union office right away. 

Hanson: Go ahead. I never said you were bluffing. I said that you 
put a fast one over on me. And I stick to that. I also stick to 
saying that I have no further interest in your case. There's 
nothing more I can do until you're ready to return to work. 

Monnier: If you think I'm faking, why don't you send me to any 
doctor you want and have them examine me. If they say I'm 
able to go back to work, I'll come back right away. In fact, I'll 
come back Monday if you want me to. 

Hanson: It's not for me to tell you when you should or should not 
return to work. But I still say that irrespective of a doctor's 
report I have formed my own opinion of you and will abide by it. 
I've asked you to go to the hospital for proper treatment when the 
injury first occurred. You have refused to do so, and that's as 
far as I am interested in the case. 

Monnier: All right, Mr. Hanson. You'll hear from me. I'm going 
over to the insurance people and see what's what. 

The agent of the Industrial Insurance Company sent Mr. 
Monnier to be examined by Doctor Wallace. The latter sent in 
the following report: 

June 14, 1937 
George Monnier 

On May 21st. employee was lifting a plate used for welding, 
when he felt a pain in his back and became doubled up. He went 
at once to the First Aid where his back was baked, and this was 
continued for four days. He was then advised to go to the hospital 
but he stayed at home and reported for baking at the shop. 
Employee feels he is improved but he still has pain. 


Shows a well developed and nourished man, 34 years of age, 
height 6 feet, weight 200 lbs. Teeth sound with the exception 
of three, which should be extracted. Throat negative. Employee 
stands with considerable stoop of the entire spine, and a list to the 


right. Motions of the spine are all guarded and there is pain in 
regaining upright position. Motions of the hips are normal. 
Straight leg raising is limited and painful. 


This man gives a history of a strain of the lower lumbar spine 
and from my examination, it is my opinion that he is still dis- 
abled and requires further treatment. I would advise that he be 
referred to the hospital for a possible fasciotomy. 

Richard Wallace, M.D. 

A few days later, Mr. Monnier came to Mr. Hanson's office to 
inform him that he had better be careful what he said since 
Dr. Wallace found that he had a lame back and was reporting it as 
such to the Industrial Insurance Company. 

On June 21, 1937, Mr. Monnier drove to Hartford, Conn., to 
put his case before the Industrial Accident Board. The following 
letter from the Assistant Adjuster in Hartford to the Adjuster in 
New Haven tells of Monnier's appearance before the Board: 

A. Monahan, Assistant Adjuster Hartford, Connecticut 

J. Riordan, Adjuster, New Haven, Connecticut June 25, 1937 

George Monnier: 

On June 21st while at the Industrial Accident Board I dis- 
cussed this case with the chairman. They called my attention to 
this case because the man had just been down from New Haven 
relative to a claim he has for an accident happening on May 21, 
1937. The Board looked up their records in this case and the only 
thing on file is an accident report, indicating that on May 21, 1937 
this employee suffered an injury to his back. I did not see the man 
myself, but was informed by the Chief Inspector that the man 
was in a very bad state, and appeared to be badly crippled, and 
could only walk by supporting himself against the wall and the 
railing as he went along, and that he had been driven down by a 
friend. I told the Chief Inspector that we had given Monnier no 
treatment and done nothing for him although a suggestion had been 
made that we would pay him a lump sum payment of four weeks. 
I told the Board that I thought there was something else behind 
the case besides the man's story, as I felt certain that if the man 
was in this condition he would have been taken in hand and given 
the proper treatment. It was evident that he excited the sympa- 
thies of everyone at the Board, and they felt the man should be put 
in a hospital because of the condition he was in. I am just writing 
this and calling it to your attention because of the fact that some- 
thing may develop on it, and if there is a background to this case 


which the man didn't tell the Board, or the man has not got the 
disability he claims he has, I would appreciate your letting me 
know so that I can convey the information to them, and wipe out 
the erroneous opinion that they have of your office from the story 
this man told. 

Sincerely yours, 
A. Monahan, Assistant Adjuster 
Industrial Insurance Company 

The following reply was sent : 

P. Murphy, Assistant Adjuster New Haven, Connecticut 

A. Monahan, Assistant Adjuster June 26, 1937 

George Monnier, Compensation. 

Adjuster Riordan has discussed with me the contents of your 
letter addressed to him under date of June 25, 1937. The claimant 
in this case apparently from your letter has misrepresented the 
facts. Following his injury our assured's Safety Representative 
suggested that he go to a hospital for treatment. He refused to 
accept any hospital treatment and at the same time he prac- 
tically refused to do anything that their First Aid Department 
recommended. He did, however, immediately following the 
injury, have four or five bakings done at the First Aid Room. For 
some unknown reason, he stopped having these treatments and 
began to talk his case to everybody he met and apparently was 
given the advice that he could do as he pleased and we would 
have to like it. 

After our assured found that they couldn't do anything with 
him, the Safety Engineer called me on June 12th and advised that 
he was sending the claimant in for me to talk to him. At that 
time I was advised by our assured's representative that the claim- 
ant would accept no treatment and that he was demanding com- 
pensation. I discussed the matter with him and suggested that 
he have an examination at this visit to our office on June 12 th 
and he immediately refused to be examined or do anything about 
his condition, beyond accepting compensation. 

After considerable talk on his part I told him that I could not 
do anything on the matter until I determined for myself what his 
injury was. I also told him to go and see Dr. Wallace and he left 
the office stating that he would think that one over, to use his 
expression. He did finally go to Dr. Wallace's office on June 14th 
and he reported to us that the claimant needed treatment. I 
verbally discussed the matter with him also and Dr. Wallace said 
that the man in his opinion, should go to the hospital as he did not 
believe he would clear up promptly by running around, as he has 
done since he was hurt. The claimant called again at our office 
on June 17th and I advised him of what Dr. Wallace reported. 
But he refused to go to the hospital, or to have anyone of the best 


four orthopedists in New Haven treat him. For your informa- 
tion, I gave him the names of Dr. Hiatt, Dr. Joseph Daley, Dr. 
Vandehough, and Dr. Wallace. I advised him that it made no 
difference to me which one of these doctors looked after him, but 
he should attend to the matter immediately and advise the doctor 
that he went to, to get in touch with the writer. Instead of the 
claimant going to any of these doctors for treatment, he merely 
remained inactive and continued to discuss the case with "Tom, 
Dick and Harry." As usual, he got plenty of bad advice, which 
sort of set him off his equilibrium. On June 19th he called at the 
office and stated that he wanted to have some compensation and 
I told him that he had not cooperated with us, in our attempt to 
help him out of his difficulty and that he should do that, as well as 
have an x-ray of his back. He agreed to have the latter done 
before leaving the office and I made arrangements with Dr. Dwight 
to have an x-ray taken. But on leaving my office, the claimant 
refused to see Dr. Dwight and the thing fell through. 

In the course of the discussion on June 19th the claimant told 
me that he was mentally sick and tired of everything; that he had 
considerable trouble and that the matter was then in the Probate 
Court and if he could get some money, he would take his second 
wife and child and go someplace for a prolonged rest. The thought 
then occurred to me that if we could add four or five weeks to the 
disability, which at that time was approximately one month old, 
and throw in something for a medical bill and back brace, it might 
possibly solve the matter. As a bait, I suggested about 8 or 10 
weeks compensation plus $75 for medical care and agreed to allow 
him to think it over for the week end and I would personally call 
at his home on Tuesday, June 22nd. 

On June 22nd, I arrived at his home at 8:10 a.m. and found him 
in bed. After letting me wait for twenty minutes, outside the 
house, he admitted me and I found that he was unable to make 
up his mind whether to dispose of this case or not and said that he 
had been to see Attorney Levinsky, who advised him that Dr. 
Wallace was an excellent doctor to treat him; that he should sub- 
mit to treatment and then request that we pay compensation. 
He said, too, on the other hand, that he was willing to compromise 
his claim as he thought that might be a good idea if he could get 
enough money to assure himself that he would have a reasonable 
settlement. I told him at his home that it made no difference to 
the writer, one way or the other, but if he was to accept compen- 
sation, he should submit to treatment by some doctor who was 
really skilled in the treatment of back injuries. He also agreed 
at that time to go to Dr. Dwight's office for an x-ray in any event, 
whether he lump-summed his case or accepted compensation. 

On June 23rd, I again met Monnier at the assured's First Aid 
Room and at that time he was very abusive both to the assured's 
representative and to the writer. He stated that he was going to 


do this thing just the way he wished and request a hearing. As he 
created quite a disturbance in the assured's main office and 
addressed his remarks to the other employees, I told him that we 
would do nothing in the matter until he cooperated and as he had 
not done so up to that time, there was nothing else I could do. 

Mr. Kallen of the Industrial Accident Board interviewed the 
writer and Mr. Riordan on June 25th, and inquired as to what the 
status of the claim was. We told him that the claimant had not 
cooperated and refused to do anything to aid himself and we were 
really in the dark as to what was the matter with him and we 
decided that we were entitled to his cooperation, instead of his 
abuse and we were willing to do the proper thing, providing he was 
to do his part. For your information, I might say that the claim- 
ant from a claim standpoint has a bad background. His father, 
some years ago was employed by one of our assureds, namely the 
Oriental Carpet Company and after recovering from an injury was 
given light work, attending one of the yard gates and after a short 
time, discharged by this concern. He also is acquainted with a 
man named Barlow who formerly worked at the same plant as the 
former did and after a prolonged payment of disability, a hearing 
resulted and a lump sum was put through by his attorney, Mr. 
Levinsky of this city who represented him. Barlow was also dis- 
charged and I believe that between these two persons and other 
agitation that the claimant had regarding this matter, that he got 
into such a mental condition he did not know what to do. Mr. 
Riordan advised me that when Monnier came to the office yester- 
day afternoon, June 25th, he told him that he was talking to too 
many persons and lacked confidence in us. The claimant admitted 
to Mr. Riordan that he had no criticism to offer regarding the 
writer, and also that he probably did make an error, in the way he 
handled his part of it. This morning at the suggestion of Mr. 
Riordan, he called at the office and advised us that he had the 
x-ray taken by Dr. Dwight, and that he had submitted to treat- 
ment by Dr. Wallace, and he is to continue with him until he 
clears up. Accordingly we paid him his compensation from date 
of injury to the present time, in the amount of $90.00. 

I have detailed this matter to you for your own information. 
You may use whatever part of it you believe you should tell the 
Board of, and I know that you will be able to give them the proper 
impression of the case, because I know that the claimant has not 
behaved as he should and he admitted it when discussing the 
matter with Mr. Riordan yesterday. 

(s) P. Murphy 

On Wednesday, July 7, 1937, Mr. Riordan called Mr. Hanson 
on the telephone and stated that Monnier could be expected to 
return to work on Monday since Dr. Wallace was of the opinion 
that he would be able to resume work. He hinted at certain 


complications in Monnier's personal affairs which would probably 
result in Monnier's being exceedingly anxious to get back to the 

On July 12, 1937, at 8:30 a.m., Mr. Monnier came to Hanson's 
office. He was dressed in his working clothes, walked up in a 
jaunty manner and reported that he was ready for work. 

Monnier: You told me to be sure and report to you before I went 

back to work. Well, here I am. If you want me to start, I'm 

Hanson: Has the doctor said that you are able to come back to work? 
Monnier: You bet your life. Here's the slip. He told me I could go 

back to work but should not do any heavy lifting for a while. 

He also gave me this prescription for a belt for my back. He told 

me to wear the belt right along. 
Hanson: Have you got the belt on now? 
Monnier: How could I? This is the prescription for the belt. I 

didn't want to get it until you said it was O.K. 
Hanson: If Doctor Wallace recommended that you wear a belt I 

suggest that you get the belt right away — get it properly fitted and 

then we'll see about your returning to your job. 
Monnier: I'll go down right away and have the belt fitted. As soon 

as I get it I'll be seeing you. 

Mr. Monnier was on the point of leaving the office when he 
turned back and whispered: "You know this has cost me two 
months' suspended sentence, for nonsupport of my first wife. 
It's the first time I've been up before the judge and would you 
believe it, he didn't even give me a chance to say a word. They 
just gave me the sentence." 

Acting on this hint, the employment interviewer looked up 
Mr. Monnier's court record. The court files contained the follow- 
ing information: 1 

Case oe George Monnier 

Born: 12.25.1902 

Birthplace: East Boston, Massachusetts 

Father: Henry 

Mother: Myrtle Bowers 

Education: Grammar School 

Height: 6 feet 

Weight: 175 lbs. 

1 The court record has been synchronized with Mr. Monnier's employment 
record for the sake of giving a complete picture. 








Employment Record 
A. B. Mfg. Co. Machinist 
Left: Not enough money. 
City Fuel Co. Chauffeur. 
Laid off. Lack of work. 
(October 7.) Henderson 
Manufacturing Company. 
Fox Lathe Operator. 
February 28. 1926. 
Quit without notice. 
National Manufacturing 
Company. August 30. 
Entered employ as Assem- 

October 24. 1927. Quit 
without notice. 

Court Record 





1934. (January 4.) National 
Manufacturing Company. 
Re-hired as First Class 

January 2. 1926. Arrested for 
non-support. Case filed. 

November 17. 1927. Arrested for 
Assault. Sentenced to 6 months 
House of Correction. Sentence 
suspended to November 17. 1928. 
December 3. 1927. Arrested for 
Non-support. Defaulted. 
April 6. 1928. Brought to Court. 
Case filed. 

April 6. 1928. Charged with vio- 
lation of Probation. Sentence in 
effect. (6 months House of Cor- 

April 6. 1928. Charged with 
breaking and entering and lar- 
ceny. Held for Grand Jury. 
May Session 1928. Tried in Supe- 
rior Court and found guilty. 
Sentenced to 2 years House of 

April 25. 1 93 1. Arrested for Non- 
Support. Probation to April 25. 

April 9. 1932. Violation of Proba- 
tion. Sentenced to 3 months 
House of Correction. Sentence 
suspended to April 9. 1933. 
February 10. 1933. Violation of 
Probation. Sentence in effect. 




Employment Record 
October 29. Laid off. 
Foreman's statement: "It 
is necessary that we reduce 
our force. Monnier being 
one of the last men hired is 
one of the first to be re- 
leased. His work is O.K. 
Would re-hire as second 
class welder." 

(January 31.) National 
Manufacturing Company. 
Re-hired as second class 

Court Record 



May 21. Put on compen- 
sation list. Strained back. 

Monday, July 12. Mon- 
nier returned to work. 

December 17. 1936. Arrested for 

non-support of child. Probation 

to December 17. 1937. 

April 8. 1937. First letter from 

Chief Probation Officer. (See 


April 27. 1937. Second letter 

from Chief Probation Officer. 

(See below.) 

July 10. 1937. Violation of Proba- 
tion. Sentenced to 2 months 
House of Correction. Sentence 
suspended to July 10. 1938 on the 
condition that he go back to work. 

The following are copies of letters sent by the Chief Probation 
Officer to Mr. Monnier. 


April 8, 1937 
Dear Sir: 

Your former wife had quite a talk with me today with reference 
to the boy. After talking with her, it would seem to me that as 
long as you are the father of the child you ought to go down to the 
Department of Health at Hartford and arrange to have the boy 
given his correct name. 

According to a record I have here under date of March n. 
1937, from the Director of the Bureau of Vital Statistics of the 
Department of Health in Hartford, the record of the birth of 


George Mercier, born February 13, 1924, in West Hartford, is on 
file. Lydia Mercier is the mother. Father's name is unknown. 

Lydia says that you are the father of the child, that you have 
publicly so stated on several occasions and that you have con- 
tributed to his support. It would seem to me that it would be 
much better for the future of this boy if your name were given to 
him, rather than have him go under the present name. If you go 
down to Hartford, I believe you could straighten it out without 
any difficulty. 

In addition you are behind here in your payments, as you, of 
course, know. Kindly arrange to pay a little each week toward 
the reduction of this arrearage. 

Very truly yours, 
(s) Chief Probation Officer 

Dear Sir: 


April 27, 1937 

Your former wife has been here again to see if you are willing 
to have the birth record of your son, George Monnier, recorded in 
your name, rather than as it now stands in the records of the 
Hartford Health Department under the name of George Mercier. 

I do not see any reason why you should not acknowledge the 
paternity of this child, since he apparently is yours, according to 
your own statement. It would not make any greater obligation on 
you by acknowledging the paternity, but would leave the child 
in a better position to face the public and would make it easier for 
him in his future years. 

Very truly yours, 
(s) Chief Probation Officer 



Case 40. The Campaign against Waste and Defective 

Workmanship at the National Manufacturing 


(An Experiment in union-management cooperation.) 

The National Manufacturing Company was an organization 
of international scope. It manufactured a wide range of machines 
and mechanical products for both consumers' and producers' 
markets. The headquarters division and the sales department 
were located in a large Middle Western city, while the 11 plants 
were scattered throughout the Atlantic states. The plant referred 
to in the following case was located in a New England city with a 
population of 100,000 and a plentiful supply of skilled labor. The 
local plant had been in the community for 30 years and was one 
of four large concerns that employed approximately 4,000 men 
and women. About 80 per cent of the employees were American 
born. The Poles and French Canadians predominated among the 
male foreign-born group; the Italians among the women. Among 
the younger employees, about 60 per cent were the American-born 
children of Polish, Italian, and French Canadian parents. The 
older employees had a grammar school education. Most of the 
skilled workers such as tool and die makers, die setters and repair- 
men, welders, electricians, carpenters, and steamfitters also had a 
high school or trade school education. About 90 per cent of the 
younger group were high school graduates or at least had several 
years of high school training. 

The products of the local plant were consumers' goods of a 
mechanical nature, depending on retail sales through the retail 
and jobbing organization that the central sales department had 
established throughout the world. The nature of the business 
was such that production schedules were seasonal, and the product 
was subject to annual changes in design, necessitating high 




peaks of production activity and sharp recessions in its several 
divisions. The general policies of the plant were outlined by the 
headquarters division of the national organization, while its local 
policies were centralized in its own management. 

Up to 1934, the local plant was organized as follows: 


















Chart XVI. — Organization chart of the National Manufacturing Company, Inc., 

plant No. 10. 

The general plan was that of a staff and line organization. 
There were three general foremen in charge of the various manu- 
facturing divisions. To them reported the foremen in charge 
of the manufacturing departments. The general foremen, in 
turn, reported to the superintendent in charge of manufacturing 
operations. To the superintendent reported also the supervisors 
of such staff departments as : production planning, plant account- 
ing, employment, cost control, engineering, and the police. The 
superintendent reported to the general manager. 

The function of labor relations was a direct responsibility of 
the general foremen and departmental supervisors. Depart- 
mental foremen hired their own employees, forwarding their 
requisitions to the employment manager for notification, examina- 
tion, and record. The discharge of employees and the rates of 
pay were also responsibilities of the foremen, subject to the 
approval of the general foremen; the same applied to inspection. 
Each foreman was responsible for the quality of products manu- 
factured in his department. Sick benefits, pensions, and insurance 
matters were treated as a matter of records and regarded as the 


responsibility of the accounting supervisor who also acted as 
office manager. Suggestions were a function of the production 
planning and time study department, the members of which 
made up the committees to study and award suggestions from 

Lack of coordination of these various activities led to much 
dissatisfaction among employees and culminated in labor troubles. 
The employees organized themselves in an industrial union for the 
purpose of collective bargaining and in the fall of 1933 went out on 
strike to enforce their demands. The settlement of this strike 
brought with it a reorganization of management and the develop- 
ment of an industrial relations department as a staff function. 
The position of the superintendent in charge of manufacturing 
was abolished. Instead, there were five divisional superintend- 
ents, one for each line of product. Under the divisional super- 
intendents, there were foremen or supervisors. In this way, 
company organization was more decentralized. At the head 
of the plant organization was the works manager. 

The new management signed an agreement with the industrial 
union and worked in close cooperation with its officers through a 
system of negotiation that had been set up for that purpose. 
Officers of the union and selected departmental representatives 
met with management on the third Wednesday of every month 
to discuss policies affecting the plant as a whole. Upon request 
of either party, special meetings could be called. In the monthly 
meetings between management and the officers of the union, 
policies were set up and published for the coordination and guid- 
ance of all divisions in matters of labor relations such as 
wages, the classification of jobs and rates of pay, employment, 
transfer, furlough, layoff, and dismissal procedure, working con- 
ditions, hours of work, vacations, and promotions. 

The administration of policies was centralized in the depart- 
ment of industrial relations. Routine complaints and matters 
concerning individual departments, occupational groups of work- 
ers, were taken care of by means of daily conferences with the 
supervisor of industrial relations. A representation plan had been 
set up, which provided for one union representative for each 
department and occupation to negotiate with management 
any problem that affected his particular department or occupation. 
When a union representative asked for a meeting with the super- 


visor of industrial relations he was privileged to bring with him 
the complainant and a second worker from the department or 
occupation in which the complaint originated. The supervisor of 
industrial relations, in turn, saw to it that in any discussion with 
the union representative, the supervisors concerned were present. 

Under both the old and new management, the problem of 
defective workmanship and materials had been a persistent 
difficulty, as reflected in excessive "45" charges. 1 The old 
management had relied chiefly on disciplinary measures to cope 
with this problem. If responsibility for defective work could be 
traced directly to an employee he was discharged. In other 
cases, the entire group was charged for defective work even on 
the previous operations that they did not perform and for the 
materials. Defective work was not eliminated by these repressive 
measures. Instead, as pressure was applied, the defective 
apparatus was squeezed out of the plant. Workmen protected 
their earnings by hiding defective products and smuggling them 
out of the factory. At one time, guards stopped the men as they 
were leaving the plant and subjected each one to a search. As 
lines were formed, and as soon as the workers realized what was 
happening, they rid their dinner pails and their pockets of any 
incriminating scrap. The next day a large packing case was 
filled with defective parts that were picked up in the yard. This 
episode opened management's eyes and also helped to account 
for the large annual inventory loss that the company had been 

One of the first acts of the new works manager in 1934 was to 
revise company policy with regard to defective workmanship. It 
was announced that "the only deductions for defective work 
that will be made from bonus earnings will be replacing the 
defective operation or operations performed by the employee or 
the group." No charge was to be made for replacing material 
or for any operations previously performed by other groups or 
individual operators. This more liberal policy resulted in a 
temporary improvement, but the problem of defective work 
remained a source of annoyance and expense. 

The works manager, then, instituted monthly meetings with 
division superintendents and staff members to discuss the problem 

1 The expression was derived from the defective workmanship and general scrap 
account, which was numbered 545. 


of excessive 45 charges. Out of these meetings came many sug- 
gestions for attacking this difficulty. One remedy tried was the 
introduction of an inspection department. A chief inspector was 
added to the staff. He developed an efficient personnel and in 
different ways improved the status of inspectors and testers. The 
chief inspector also started an intensive educational campaign. 
In every department, Bogie Posters were displayed showing the 
monthly percentage for the plant. It was difficult to estimate 
the influence of such publicity. Several union representatives 
expressed the opinion that the workers paid practically no atten- 
tion to posters of this type. The statistical information was too 
remote from their everyday experience. If they did notice the 
high monthly percentages of scrap they took the stand that it was 
up to the inspectors and testers to reduce such losses. This 
may have been one reason why the chief inspector's campaign 
had no permanent effect. After a slight decrease, the defective 
charges increased again. It appeared that unless something 
effective could be done, the average percentage for 1937 would be 
higher than it was in 1936. The chief inspector urged that some 
means should be found to enlist the cooperation of the men at the 
bench. Not only inspectors and testers, but every worker in 
the plant needed to be educated as to the significance of the 
45 account. 

It was decided to attack the scrap question as an industrial 
relations problem and to solicit the cooperation of the union. The 
president and the business agent of the union were at first inclined 
to be suspicious of this program. They feared that union rep- 
resentatives would be expected to act as spies; that employees 
who were responsible for defective work would be discharged; 
and that foremen would resent union participation in what, after 
all, was a management problem. On the other hand, they could 
also see the advantages to the union in such cooperation. It 
offered an excellent opportunity to show how a responsible union 
could help management to attack a difficult plant problem. 
Secondly, such cooperation would have the distinct advantage of 
acquainting union representatives and workers with management 
policies. After several meetings with the industrial relations 
supervisor, the union leaders promised their support. 

During the planning of the campaign, it was brought out that 
Mr. Wellman, superintendent of the motored appliance division, 


had been able to keep his scrap account at a consistently low level 
for over a year. It was found that he had been conducting weekly 
foremen's meetings to discuss the scrap problem. Union repre- 
sentatives in his division had also attended these meetings. 
The industrial relations supervisor was convinced that the 
cooperation between union and management had been a significant 
factor in Mr. Wellman's success. 

Two of Wellman's union representatives, Messrs. Black and 
Moore, were selected by management to cooperate with the works 
manager and the supervisor of industrial relations as members 
of the planning committee. It was decided to start the publicity 
of the campaign with posters of a mystery nature in order to 
arouse interest. The first poster placed throughout the plant 
was a huge question mark. This was followed by a poster with 
the statement: "U Should Be Interested." Each time a poster 
appeared, the union paper displayed the same message on every 
one of its pages. Incidentally, all advertising space in the union 
paper was contributed by the union. Posters were changed once 
a week and every effort was made to emphasize the part played 
by the union in this campaign. For instance, one poster put the 
question: "What is the 45 Charge?" and urged each employee to 
"See your Representative." 

September 20, 1937, was set as the opening date of the scrap 
campaign. On this day, several meetings were held with super- 
intendents, foremen, and representatives of the different shifts. 
At these meetings the works manager made the keynote speech 
in order to personalize the crusade against scrap as the "Manager's 
campaign." Both union representative Black and union 
representative Moore addressed the groups and told of their 
experience in cooperating with Mr. Wellman in building up a 
scrap-minded department. 

The following is a transcript of Mr. Black's remarks : 

Ladies and Gentlemen: 

Mr. Avery (supervisor of industrial relations) has me listed to talk 
on "How to Handle Scrap," and I think Jim greatly overestimates my 
ability, so what I am going to attempt this afternoon is to talk on 
"How We Tried to Eliminate Scrap in Our Department." 

Mr. Wellman (division superintendent) and Mr. Haynes (foreman 
of inspection) must be ardent students of Mark Twain for they likened 
the scrap problem to Mr. Clemens' comments on the weather. He 


said, " Everybody complained about it but nobody ever did anything 
about it." 

However, these gentlemen thought that something could be done 
about the scrap problem, and they called a meeting, about eight months 
ago, of the floor foremen, group leaders, and union representatives. 
I may say we all went to this meeting shaking in our shoes, wondering 
why we had been called on the carpet. 

At our first meeting, Mr. Wellman and Mr. Haynes gave us some 
astounding figures on scrap that made us all sit up and take notice. 
About this time our 45 charge on scrap was approximately $2,500 a 
month and at our last meeting on Wednesday, the fifteenth, through the 
united efforts of everybody in the department, we had brought this 
down to $700 a month. This last week the figure was $65.95. Now, 
gentlemen, you will realize this was not done without a lot of hard 
work and cooperation. I would at this time stress the word "coopera- 
tion" as this was not a one-man job, and any one individual who 
attempts it is doomed to failure. 

At this time I want to give you my reaction after our first meeting. 
I was under the impression that we were to act as policemen and 
report anyone turning out scrap, and they in turn were to be fired. 
As a union representative, I felt I could not and would not be a party 
to such a setup. I brought this matter up at our next meeting, and 
Mr. Wellman assured me that this was not the case, and I can assure 
you, gentlemen, that not a single individual has been laid off in our 
department for spoiling work. 

In fact, at one time, the division superintendent had to protect 
one of the workmen against his outraged fellow workers. The worker 
had spoiled $120 worth of work through inattention and carelessness. 
Committee members were insistent that he should be fired. The 
division superintendent, however, did not want to risk losing the con- 
fidence of his force. He told the committee: "The man deserves to be 
fired, but I have made a promise, and I am going to keep it. No one 
is going to be fired for spoiled work. We can succeed only by getting 
everybody's cooperation." 

Our first major problem was to gain the confidence of the men and 
women in the department, a great many of whom thought as I did, 
and it took us some time and a whole lot of talking to convince them 
that they should be just as much interested in keeping down the 45, 
as it affected their earnings just as much as ours. 

Today I am glad to say we have a scrap-minded department. We 
have a long way to go yet, but I feel assured we are headed in the 
right direction. 

I am sure you gentlemen will be interested to hear just how we 
handle our various problems. 

When a particular item of scrap is brought to our attention, the 
parties directly concerned are called into our meeting and the general 
layout of the job is discussed from all angles. Should this particular 
problem be one of machining, there are various conditions that can be 


blamed for not turning out good work, such as a jig or fixture being 
out of line; insufficient instruction to the operator (this refers more or 
less to new help); and also we have the problem of old and worn 

We had one such case in our machining department — an old hand- 
turret lathe. This machine had passed its era of usefulness, and no one 
could get a perfect piece of work from it. I am talking of one of those 
machines you had to set up after each piece of work. This matter was 
brought to the attention of the foreman, and I am glad to say the 
condition has been corrected, and we now have a new machine. 

Then, we have another contributing factor in the making of scrap 
and this, to my mind, is a very important one. In many cases the 
time studies are made so close that the operator has to work at such a 
pace to even make standard time that he or she cannot exercise the 
proper amount of care to insure a perfect product. I am convinced 
more cooperation on the part of the time-study department and a 
more sympathetic understanding of this problem will help considerably. 

Then we had the fellow who is just naturally not so careful as he might 
be. We all have met him. He just slides through life as easily as he 
can, letting the other fellow do the worrying. You will notice I used 
the past tense, because we have, through education, more or less 
overcome this problem. 

We had one particular case brought to our attention concerning 
fields coming in from the winding section to the assembly section. A 
great many of these fields were shorted and as these fields cost approxi- 
mately $1.85 each, it was imperative that we give this matter our 
immediate attention. Again the interested parties were called in. 
This was a problem of handling and containers, and I am glad to say 
has been successfully overcome. 

In conclusion I come to our biggest and costliest item on 45. That 
is work coming from the various feeder departments. In many cases 
we don't discover the defective part until we have the finished article 
completely assembled. Very often it is a small screw or clip costing 
the production department a few cents, but our labor cost in tearing 
down, replacing the defective parts, and rebuilding is very high. This 
is a very important issue. 

I am firmly convinced that to overcome this problem, which is 
one of the biggest confronting industry today, we must have more 
interdepartment and more plant cooperation. In other words, every 
man and woman employed by the National Manufacturing Company 
must become scrap-minded. 

Mr. Black's colleague, Representative Moore, talked as follows: 

Chairman, ladies and gentlemen : 

I will tell you in my own way what we are trying to do in our 
department. In the first place, I do not want you to get the illusion 
that we have performed miracles, because we haven't, but we have 


taken the matter of scrap in a serious way. After having a meeting on 
this subject, we found that it was a matter of education; that we had 
to educate the operators. We had to go out and teach the employees 
the seriousness of this scrap, of what it costs when we have had previous 
operations on an item. If you get them to understand that and then 
go after it in a good legitimate way, and if we find out anything that is 
puzzling to us, we invite them in, or the group leader, and speaking of 
the group leader, we have placed the responsibility of scrap on him, 
and he consequently takes an interest in this subject and goes out and 
brings back a report on the different situations. We don't put the 
fear of God in a man concerning his job because he made scrap, but 
if you can educate a man to the seriousness of scrap and get him scrap- 
minded, we can do something. We cannot eliminate this question of 
scrap, but we can help it. We had a case of a man on the floor and 
found that we weren't handling material right. We took this up with 
the general foreman and have had some containers made to handle this 
material. We have licked one or two problems up there that we can 
feel proud of, for no other reason that every time we sat down for a 
meeting, the same thing came up. We called in the operators and told 
them what it was costing us and that something was wrong. The 
operator is not necessarily careless, but he probably has a close job and 
tries to rush it and doesn't stop to realize what the cost of scrap will 
amount to if he has put operations on the product. We assured the 
operator that we weren't trying to humiliate him before his group or 
anything of that kind, and we had a heart-to-heart talk with him. 
He consequently is a better man in the department than he was 
before because he stopped long enough to realize the seriousness of the 
value tied up in the job. We have called in the cooperation of the 
inspection department and they have given us figures of the cost. 
When we get material in our department and feel it is not right, we have 
instructed the operator not to use the material until the floor inspector 
looks it over, and if it is not as it should be we turn it back to the 
department from which it came. This saves us and other departments. 
We have one bone of contention. We get a piece of apparatus, say a 
rotor or something in that respect. We find out it can be made for 
five cents in our department, but you get it in the apparatus upstairs 
and it cost about $1.20 to tear it down. That is wasting money and 
we are trying to educate the people along this line. We want to be 
fair with the operators and give them every opportunity to do their 
work. He is capable of doing it, but there may be something wrong 
with the operations or with the machine. If that is so, we take it up 
with the foreman in the department and get his cooperation. We even 
shut the machine right down, which you may feel is pulling some pretty 
raw stuff, but we do this for the reason that we want it right before we 
start up, which gives the operator a chance to turn out better work. 

What we have tried to do in our department has been done not by 
one man or three men but with a committee of twenty men, which 
includes group leaders, some inspectors, some production men, and 


operators. When we get together in a meeting with those that may 
be implicated with scrap for that week we call a spade a spade. But we 
do nothing at all that would in any way injure an operator with his 
foreman or group leader. We want to keep harmony with each group 
leader, and the operators are not hung or humiliated or bawled out 
because they had the misfortune to make scrap. We are scrap- 
minded in our department. We have simply taken the things as we 
find them and tried to show the ones involved our reasons for feeling 
as we do and try to get their cooperation. We think we can do better 
than we have done. 

The next day, Sept. 21, the foremen of the various depart- 
ments each held his own meeting in order to set up departmental 
scrap committees. Each committee was composed of a fore- 
man and a union representative and key men from inspection, 
production, and time study. There were three types of committee 
control. In the motored appliance and the maintenance depart- 
ments, the foreman acted as committee chairman; in the air 
conditioning department, the superintendent assumed this func- 
tion ; while in the refrigeration departments as well as in the feeder 
sections, union representatives acted as committee chairmen. 

At first, there were other differences in organization and pro- 
cedure. In order to eliminate these and to coordinate the work 
of the different committees, a general plant committee was formed 
to meet once a month in order to discuss problems of general 
interest. These meetings were attended by superintendents, 
foremen, union representatives, and the supervisor of industrial 
relations. At one of these meetings (Oct. 14, 1937) the following 
procedure was adopted for the administration of all department 
meetings. The procedure was initiated and developed by Repre- 
sentative Black. 

Procedure to Be Followed in Departmental Scrap Meetings 

At the meeting of the general committee held October 14, 1937, it 
was unanimously decided that a uniform policy be formulated for 
carrying on departmental meetings. 

Your commiteee has adopted the following schedule, which we 
trust will aid you in carrying on your program in a uniform manner. 

It is essential that the schedule be strictly adhered to and all 
meetings start on time. It is also very important that each chairman 
appoint a secretary and a record of the proceedings be kept and read 
at the next meeting. 

The order of the business to be followed by all chairmen is as 


1. Opening of the meeting. 

2. Roll call of members. 

3. Minutes of last meeting (read and approved). 

4. Report of the sub-committees. 

5. Unfinished business. 

6. New business. 

7. Instructions to sub-committees. 

8. Remarks. 

9. Adjourn. 

In accordance with a suggestion by the works manager, Repre- 
sentatives Black and Moore were called upon by other depart- 
ment committees to help in organizing their weekly scrap meetings. 
Management released these two union representatives from other 
duties, and for several weeks, Black and Moore did nothing but 
cooperate with different departmental committees. An instance 
of their activity appears in the minutes of a meeting held Oct. 26, 
in G-50. 

Meeting called to order 3 p.m. by Mr. Stowell, General Chairman. 

All groups represented along with Production Department, Inspec- 
tion, Die Repair, with Messrs Black and Moore present as interested 
observers of our procedure. 

After checking with various group leaders, Mr. Stowell suggested 
that we hear from Mr. Black and Mr. Moore with respect to their 
views on our procedure or any constructive criticism they might wish 
to offer. 

Mr. Black gave us many helpful suggestions in curtailing our 
"45" charges: 

1. Group Leaders gaining confidence of operators. 

2. Hurried orders being 100% perfect regardless of production 

3. Making certain of tool equipment. 

4. Not to forget this was purely an educational campaign, and 

5. Being sure of ourselves. 

Mr. Moore followed with a very instructive talk on "45" charges, 
stating that the charges had been allowed to build up in previous years 
with very little effort expended to remove such, outside of talking 
about them. 

The activity of Black and Moore was an important factor in 
coordinating the campaign and was appreciated by management 
and various committee members. However, it also aroused 
criticism among the employees. Rumors were started that these 


men had become "management men"; that they were trying to 
make a white-collar job for themselves; and that now being "all 
dressed up, they had forgotten what it felt like to work at the 
bench. " For a while it seemed as if these rumors might disrupt 
the campaign. Management met this difficulty by bringing 
other union representatives into prominence. 

Throughout the campaign, the supervisor of industrial rela- 
tions or his representative attended the various scrap meetings 
and analyzed the minutes. Many incidents called for the moder- 
ating influence of men versed in personnel relations. For example, 
during the scrap meeting where current defective apparatus was 
exhibited to the committee and subjected to a painstaking analysis, 
it often happened that employees responsible for scrap were 
brought from the bench into the committee room. Great care 
had to be exercised at times to preserve the calm of judicial 
inquiry and prevent a meeting from degenerating into an inquisi- 
tion. In other instances, secretaries in reporting the business 
transacted during the meeting, cited workers by name. If a 
man had been found responsible for making scrap, this was a 
dangerous practice and had to be discontinued. The temper of 
most meetings, however, was excellent and did much to convince 
the workers that the scrap campaign was really an adventure in 

Another difficult feature of the scrap campaign was that fore- 
men frequently were put on the spot. Group leaders and union 
representatives at times delighted in "showing up the foreman" 
by pointing out that some time ago he had been advised of a 
certain defect and its cause, but that weeks had been allowed to 
pass without any action being taken. 

But these difficulties, in the eyes of management, were more 
than counterbalanced by the practical results of the campaign. 
Every department experienced a lowering of the 45 charge. This 
gain is graphically illustrated by the charts on pp. 265 and 266. 

Chart XVII shows the total 45 charge for the local plant 
expressed in dollars by months. The dotted lines show average 
values for the full year 1937 and for the first four months of 1938. 
The general downward trend is to some extent affected by a decrease 
in productive activity. 

The columns show the average monthly charge for each division 
and thus give an indication of the distribution of these expenses 



by products. The general downward trend is to some extent affected 
by a decrease in productive activity. 

Chart XIX shows the same information as that given in Chart 
XVII, except that it is expressed in percentage of productive 


July Oct Jan. Apr July 

1937 1938 

Chart XVII. — Local plant's 45 charge by months, expressed in dollars. 

labor cleared in cost. This eliminates the effect of volume reduc- 
tion and presents a picture of actual performance. 

The columns show the average monthly percentages by divi- 
sions. In both Charts XVII and XIX there is a general downward 







■ 1-1 

■ ■ VSS/A miuim 

First four months in 1938 

Entire year-1937 

Chart XVIII. — Divisional monthly averages of local plant's 45 charge expressed 

in dollars. 

trend observable, and it can be seen from the dotted lines which 
show averages that, for the first four months of 1938, the per- 
centage is a little more than 2 per cent lower than for 1937. 



Every department in the plant became thoroughly scrap con- 
scious and cooperated in improving the quality of the product and 
in reducing waste. The following letter sent out by the industrial 

Jan. Apr. July Oct. Jan. Apr. July 

1937 1938 

Chart XIX. — Local plant's 45 charge in per cent of productive labor cleared in cost. 

Entire year- 1937 First four months in 1938 

Chart XX. — Divisional cumulative percentages of plant's 45 charge, in per cent of 
productive labor cleared in cost. 

relations department calls attention to one example of such 
cooperation : 


December 3, 1937 
Superintendents, Foremen 
and Chairmen of "45" Committees: 

The "45 " Campaign Committee of the Power House has called 
to our attention, by way of reports, at various times since the "45 " 
campaign got under way, many instances of windows being left 
open at the close of the shift. In some cases, the rain has blown 
in through the open windows and considerable damage has been 
done to finished products due to rust. 

The report of the Power House this week listed approximately 
one hundred and forty-five windows that had been left open. Not 
only is the product damaged in this respect, but a severe loss of 
heat occurs which naturally reflects seriously in our efforts to cut 
down waste. 

Other instances which have been brought to our attention are 
truckmen leaving the doors open after passing through rather than 
closing them as they should. 

Another item is air and steam leaks. These should be reported 
to the foreman of the department immediately so that proper 
repairs may be made with all possible haste. 

It is my opinion that various "45 " Committees throughout the 
Plant can aid materially in correcting these conditions and we 
respectfully ask that you read this letter in your meeting and, if 
necessary, appoint a sub-committee to check into the situation in 
your various departments toward eliminating this particular phase 
of the waste which is of great importance to our campaign. 

We trust that when we next have a report from the "45" 
Committee of the Power House, open windows, open doors, steam 
and air leaks will show a material decrease. Needless to say, we 
anticipate your cooperation. 
Approved by: 

General Committee 
Approved by: (s) Endicott 

J. Avery 

This appeal resulted in a 7 5 per cent improvement of the condi- 
tions stated. 

Even more important than the benefits that could be stated 
in dollars and cents, were the intangible benefits derived from the 
educational and informal aspects of the scrap meetings. The 
minutes give an account of the business transacted at the meetings 
but do not tell the whole story. Committee members had repeated 
opportunities to exchange opinions on topics other than scrap 
problems and to talk about other management policies. For 


instance, at the end of one second-shift meeting, a committee 
member called attention to the company's training program for 
group leaders. He wondered what was being done for second- 
shift men. There were 12 to 15 group leaders on the second shift 
who would have liked to attend an evening course but could not 
do so because the hour of meeting conflicted with their second- 
shift duties. In the ensuing discussion, a committee of six was 
appointed to interview the foreman and the supervisor of indus- 
trial relations. The result of these interviews was that arrange- 
ments were made to permit these men to attend the evening class. 
The question of " outside work" came up frequently at the 45 
meetings and afforded excellent opportunities to demonstrate the 
part played by defective workmanship and waste in increasing 
factory cost. If the discrepancy between inside and outside 
cost was too great, management sent the work outside. Such 
work could be kept in the plant only by cutting down waste and 
excessive 45 charges. As workers understood this, they cooper- 
ated heartily in an attempt to reduce waste, and in this way many 
items were brought back into the plant. 

Case 41. The Stevenson Case 

(Union-management Cooperation in bringing back work that had been sent outside.) 


Mr. Stevenson, union representative for the punch-press department. 

Mr. Avery, supervisor, industrial relations. 

Mr. Cameron, president of the union. 

Mr. Rankeillor, division superintendent. 

Mr. Smith, cost clerk. 

Mr. Ulrich, time-study man for the punch-press department. 

Mr. Abbott, works manager. 

On May 4, 1937, Mr. Stevenson, union representative for the 
punch press department, came into the industrial relations super- 
visor's office and said he wanted to talk about conditions in the 
stamping section. Mark Cameron, president of the union, hap- 
pened to be in the office, and the industrial relations supervisor 
decided to discuss the matter immediately. 

Stevenson: It's a damn shame that we have to lay off people in our 
punch shop when we're buying so much material outside that should 
be made here. Can't we do something about it? 

Avery: What d'you suggest we do, Joe? 

Stevenson: It seems to me we ought to be given a chance to go over 
the items that are now being bought outside to see if we can't bring 
them back in. 

Avery: I think that's a good idea. Let's start right now. I might 
begin by saying that there are probably two reasons for buying 
material outside: 

Three months ago, we were so busy that we did not have capacity 
to make all the parts we needed and so had to buy some of the 
material outside in order to meet our schedules. This was done 
purely on the basis of production need and regardless of cost in 
some instances. It might be a good idea, therefore, to review the 
items in this class in order to see if we can't bring some of this 
work back right away. 

The second situation is more difficult. We are able to buy some 
of the parts cheaper on the outside than we could possibly make 
them here under existing conditions. There are various reasons 
for this. In some cases the production setup of the outside 
supplier is better adapted on a particular part than ours. In other 
cases, labor costs may be the deciding factor. Items in this class 
are harder to bring back. 



Stevenson: Well, it certainly burns me up to look at my department 

out there and see what a skeleton it is. We haven't got one third 

of our total working force out there. I was just going over some of 

the items with our rate setter and I'm sure we could make some of 

this stuff cheaper if we were given a chance. 
Cameron: Now wait a minute, Joe, we're not going to stand for any 

cutting of rates. I don't believe the department is as bad off as 

you say. 
Stevenson: Do you know what you are talking about or are you 

kidding? You'd better get out there and look at the place. It's 

like a skeleton. 
Cameron: Well, I just want to make sure that we understand each 

other. I'm not going to sit here and agree to cut rates, either in 

time study or otherwise. 
Stevenson: Well you know damn well these fellows are making damn 

good money out there, 160 and 170 per cent. If we could get back 

to a reasonable 140 per cent we could meet some of this outside 

competition and keep more of our people on the job. 
Cameron: Well, you know why these other concerns can make it 

cheaper than we can. They're not unionized and they're paying 

starvation wages. 
Stevenson: In the meantime our boys have to take the rap. 
Avery: I think we can work out something that won't do any of us any 

harm and we shall probably get a good education by going over 

some of these problems. 

(to Mr. Stevenson) Supposing you do this, Joe, get hold of one 

of these items we're buying on the outside and then let us see what 

the problem is. 
Stevenson: I have one right here, the slicer-housing job, part No. 

840503. This job used to be made here and is now being placed 

outside. And let me tell you, it is a damn good item, about 

300,000 pieces a year. 
Avery: Well, I suggest we meet this afternoon at two o'clock. This 

will give me a chance to get the other interested parties here. 

In the meantime, Mr. Avery checked up with the purchasing 
department on the outside cost of the item mentioned, which was 
$100 per thousand or 10 cents a piece. He also inquired at the cost 
department and found that the factory cost was $140.80 per 
thousand or $0.1408 per piece. He then invited Mr. Rankeillor, 
the division superintendent, and Mr. Smith, the cost clerk, to 
attend the meeting. 

At two o'clock the same day, Rankeillor, Avery, Smith, 
Cameron, and Stevenson met in the office of the industrial rela- 
tions supervisor. 


Avery: Mr. Rankeillor, I called this meeting to discuss an item which is 
now being placed outside but which our boys feel should be made 
here in the plant. 

Rankeillor: I think this is a mighty good thing, and I hope we can 
continue the practice. Nobody hates to see work go outside more 
than I do. This practice plays the devil with our productive labor 
force. But we must remember, both in selling and manufacturing 
our product, we have to meet competition. 

Avery: The item under discussion here is the slicer-housing which, I 
understand, is purchased from an outside supplier at a little more 
than four cents under ours. 

Stevenson: Does this price include shipping, packing, and freight from 
the supplier to our plant? 

Smith: Yes. I have all the details on this item here and will be glad 
to go over them with you. The big saving is in labor cost. We 
can't possibly make this part here at such a price under our present 
setup and at the percentages we're paying. 

Stevenson: I wonder if we could get the time-study man over here? 

Avery: I'll find out. 

Avery called Mr. Ulrich, time-study man for the punch-press 
department, on the phone. Mr. Ulrich promised to bring the 
time study of the job under discussion. On joining the confer- 
ence, Mr. Ulrich was informed as to the purpose of the meeting 
and asked to discuss the slicer-housing time study. After dis- 
cussing the method of making a time study, he said: 

Ulrich: I think this was a poor time study in the first place. My 
understanding was that the operators on which this study was 
made were sour on the job. As a result an improper time study 
was made. There's no justification for paying 160 or 170 per cent 
on this job when the average punch-press job is around 140 per 

Avery: In other words, your belief is that these fellows are now suffering 
for having been able to get away with a loose time study. If the 
time study had been more accurate we should not have had to 
place this work outside? Is that what you mean? 

Ulrich: Correct. 

Stevenson: Well, I've been in this department all my life and I know 
press work. I also know that the time values on several of these 
operations are too high. I, for one, am willing to go out and talk 
to the operators on this job. I think we can meet this price or even . 
better it. Will you bring the job in again if we do? 

Avery: What do you say, Mr. Rankeillor? 

Rankeillor: We certainly will if you come anywhere near it. Further- 
more, I think that with cooperation on the part of the fellows it can 
be done. 



Cameron: Only be damn sure, Stevenson, that this is in agreement with 
all the people out there, not just a few. I think you ought to get 
all the fellows together over at the Union Hall and talk about it 
before you agree to anything. 

Stevenson : I may do that. Primarily I am interested in seeing that we 
get work to do out there and that doesn't mean that I need to get 
work for myself, because I have been there ten years. I'm sure 
that I can stay. 

Avery: Well, the only thing I can say, fellows, is that whatever you are 
going to do, do it quickly, because I have asked the purchasing 
department to hold up an order that they are ready to place with 
the supplier for the next production run. 

Stevenson: O.K. I'll give you my answer tomorrow. I am interested 
in this thing as the representative of my people. I feel I owe it to 

Stevenson talked to the workers in the punch shop and per- 
suaded them to have another time study made on the slicer- 
housing job. This was done, and the factory cost was brought 
down to $114.40 per thousand or $0.1144 per piece. The reduc- 

Time Study i 
Cost of Manufacturing Slicer Motor Housing, Style 840503-A 













run. time 
















1 st draw 







2nd draw 







3rd draw 



1. 00 




4th draw 







5 th draw 







6th draw 


















. 001 2 












. 0041 






. 0098 













. 0044 







. 0060 


Counter Bore 













Pickle Rust Proof 



. 0042 






E 0.0013 


Material Price: 0.04 Scrap Credit: 0.0008 
Material Cost: 0.0333 
Labor and Overhead Cost: 0.1075 
Factory Cost: 0.1408 



tion was accomplished by means of eliminating certain operations 
and combining others. In some instances also, the running time 
of an operation was shortened from 0.0025 to 0.0022 per piece. 
A comparison of the two time studies will show all the details 




Cost of Manufacturing Slicer Motor Housing, Style 840503-B 






ird Time 







p run. time 







2 0.000678 







3 . 000698 



1st draw 




J 0.0037 



2nd draw 




3 O.OO24 



3rd draw 




; 0.0022 

. 0046 


4th draw 




; 0.0022 

. 0046 


5 th draw 




> 0.0022 

. 0046 






; 0.0022 

. 0046 

















. 0044 


Size & Bump 




1 3 









. 0060 


Counter Bore 





De-rust and Rust 




Material Price: 0.04 Scrap Credit: 0.0008 

Material Cost: 0.0333 

Labor and Overhead Cost: 0.081 1 

Factory Cost: 0.1144 (reduced rate: 0.0264) 

Interview with Mr. Stevenson in the punch press department 
(June 12, 1937). 

Interviewer: Mr. Stevenson, would you mind telling me how the 
slicer-housing job was brought back into the department? 

Stevenson: Not at all. (Walks over to the section where the housings 
were undergoing drawing operations, picks a finished piece out 
of the truck, and displays the part.) These housings were origin- 
ally made by the National Manufacturing Company at a cost of 
14 cents each. Management thought that this was too expensive 
and gave the job to an outside manufacturer, who was able to 
make the housings four cents cheaper. We retimed the job and 
the engineers made a few changes. We're now making the hous- 
ings again in DaCoste's and Anderson's groups for approximately 
11 cents a piece. 


Interviewer: Whose idea was it to bring the work back? 

Stevenson: I'm not so sure whose idea it was. Harry Ulrich, the 
time-study man, Mr. Rankeillor, superintendent of the feeder 
section, and myself were involved. You understand, at no time 
did we quote each other but we were all working together. 
I had nothing to gain for myself but consider that it is a part of 
my job as union representative to see that the fellows here have 
lots of work. You understand, of course, that many union rep- 
resentatives don't take this stand, and I have to use quite a lot of 
discretion, for, if this sort of thing got around to all the employees 
they would say that I am trying to sell out to management. On 
the other hand, my men are satisfied. 

Interviewer: How did you get the idea across? 

Stevenson: I first talked to the group leaders individually. Then I 
talked with the operators in the different groups. Mr. Cameron 
thought I ought to take the bunch over to the Union Hall, but it 
was more convenient to talk to them right here on the job. After 
I had convinced the men that a new time study should be made so 
that we could keep the work in the plant, I talked the matter over 
with Mr. Rankeillor. He suggested that a time-study man should 
come right away and make a new study. It was agreed, however, 
that he would send a time-study man who got on with the group. 
There are three time-study men in the department, but unless 
you send the right man you do more harm than good. I can tell 
you if Mr. Rankeillor had sent a certain man the operators would 
work toward a higher rate rather than consider a reduction. But 
the right man went in, and a satisfactory restudy was made. The 
groups cooperated because they realized that the benefit was 

Interviewer : Are you contemplating making similar restudies on any 
other job? 

Stevenson: Yes, we have one of them right here, the brass cooler 
shells. At present they're costing us about $3 a piece. In the 
plating room the men are getting about 90 cents for each job and 
are making as high as 165 per cent. I talked to the group leader 
on the job and told him that once the works manager finds he 
can get the cooler shells from outside suppliers for $1 less, our men 
will lose the work. The group leader knows that this is one of 
their big-paying jobs, and that it will make a hell of a hole in their 
earnings if they were to lose it. He asked me whether a 20 per 
cent reduction would keep the job in the plant. Naturally, I 
couldn't promise, but I told him that I would take the matter up 
with Mr. Rankeillor. We're working on this job now. 

At the next meeting of union and management representatives, 
held June 22, 1937, Mr. Cameron brought up for discussion the 
question of sending out jobs. 


Cameron: The most important subject is that of sending out of jobs. 
We find that the punch shop, screw machine department, and 
others, are sending out jobs to outside suppliers who can do it 
cheaper. We feel that there is absolutely no use getting a raise 
in wages if the jobs are sent somewhere else. It doesn't mean 
anything if you aren't working. We want to stop the work from 
going out. We want to know what we can do — what our procedure 
is. All we know is that every day or every week another job 
gets sent outside. 

Abbott: What you can do is to help us get the cost of those items down 
to a figure such that we can afford to keep the work inside our 
plant. I might say that it is to the advantage of your local man- 
agement, as well as to every employee, to keep as much work 
within our plant as possible. From the employees' standpoint it 
means more work, and from management's viewpoint it means we 
have more expense money on which to operate because of higher 
productive labor. 

We cannot, however, disregard the economic facts of our business. 
Competition sets the selling price, and a way must be found to 
produce our products at a cost which will permit us to meet the 
market prices. If our wages and salaries have been increased, it 
naturally follows that we must find a means of producing our 
product in less time so as to effect a lower cost; otherwise, we shall 
be forced to increase the selling price and lose volume in that 

Faced with these conditions, there is no alternative but to secure 
the various items or subassemblies which enter our product at the 
lowest cost consistent with quality. If we cannot produce any 
particular item in our own plant at the same or approximately the 
same cost at which it can be bought outside, then there is only 
one obvious answer, we must buy the item outside. 
I do agree with you that on many of these items, if we were to 
take our coats off and go to work together, we could effect a very 
substantial cost reduction. 

Cameron : We would like to have a setup whereby we could know when 
management was considering taking any job outside the plant. 
We are willing to cooperate on these jobs, but if we don't know 
until the job disappears, we cannot do anything because it is then 
too late. 

There was a long discussion on this subject. Mr. Abbott 
cited specific examples showing local factory cost and the cost 
outside, with the result that the representatives asked for an 
opportunity to review some of these items with the representative 
of the department affected, the group leader and possibly some 
of the employees as well as the time-study men. It was believed 
that in this way methods might be suggested that would bring 
down excessive factory costs and permit the work to remain in 


the plant, thus increasing hours of employment. Mr. Abbott 
agreed to having his organization enter wholeheartedly into such 
a program with the shop people and asked the industrial relations 
supervisor to head up such a program. 

The industrial relations supervisor developed the following 
plan: The supervisor of production planning (whose duty it was 
to schedule work throughout the plant, that is, place orders for 
work to be done in the plant or purchased outside) , was to submit 
to the industrial relations department a list of the items that were 
to be sent outside. The following information was to be supplied : 

Name of part. 

Style number. 

Department in which the item was made. 

Inside cost. 

Outside price. 

The industrial relations department was then to notify the 
union president and arrange a meeting with the department repre- 
sentative, the departmental foreman, and the time-study men 
in order to discuss all further details with reference to the item 
about to be purchased outside. 

On Friday, July 2, 1937, the following signed article was promi- 
nently displayed in the upper left-hand corner of the front page 
of the official news organ of the union local. 

Looking Forward 

During the last few months it has been apparent to me that we will 
have to face the problem of how to deal with those jobs that are being 
sent outside because other plants are doing them cheaper. At the last 
Negotiation Meeting with Management, it was agreed that we would be 
consulted before these jobs are sent out, not after they are gone. 
Arrangements are being made whereby the representatives in the 
departments where those particular jobs are located will be called into, 
conference for their suggestions. 

I urge every representative to keep in close touch with his depart- 
ment and to submit any information about such jobs which he or she 
thinks will be helpful. Of course, the real answer to the problem is to 
get all those competing plants organized. Until this is accomplished, 
we will always have this problem confronting us. In the meantime, 
don't let us take a "do nothing" attitude. It is the problem of the 
whole organization and your officers need the cooperation of all repre- 
sentatives and members to solve it. 

(s) Mark Cameron, President. 


Case 42. The Case of Aristide Cote 

(Personal preoccupations of a toolmaker at the National Manufacturing Company, 

Inc., Plant No. 10.) 

Characters : 

Mr. Gordon, toolroom foreman. 
Mr. Cote, former toolmaker, now tool repairman. 
Mr. Avery, supervisor, industrial relations. 
Mr. Wellman, union representative. 

Mr. Aristide Cote was employed at the National Manufac- 
turing Company as a toolmaker. He was considered an able 
mechanic, but because of his suspicious attitude it was difficult to 
secure his cooperation. In private conversation with Mr. Ken- 
dricks, the employment manager, Mr. Cote hinted that he had 
many suggestions for improving existing routines and work habits. 
The employment manager was impressed with the practicability 
of some of the suggested improvements and urged Mr. Cote to 
submit his plans to management through official channels. But 
Mr. Cote was unwilling to avail himself of this procedure for fear 
of antagonizing his foreman and his fellow workers. 

Mr. Cote's employment record and subsequent interviews 
with him revealed the following situation : 

He was born on May 30, 1900 in Paris, France, and had been 
working for many years as a diemaker. He was employed by 
many different firms and always did satisfactory work. But, 
in each case, after two or three years of employment, he would 
move to another town. His last position before coming to High- 
land was with a New York firm that manufactured automatic, 
machines. There he had been a foreman and had been considered 
a specialist in making dies for automatic machines. He had con- 
stantly boasted of his abilities and also had been extremely 
critical of fellow workers and superiors. Finally he was obliged 
to leave on account of the friction engendered. 



On Aug. 20, 1936, Mr. Cote moved his family to Highland 
and found employment with the National Manufacturing Com- 
pany. According to his statement, his two children were in deli- 
cate health, and he had left New York because he thought the 
climate in another place would be better for them. He said that, 
for the sake of his children's health, he was very anxious to settle 
in his new location. 

On his new job he was extremely sensitive and quick to take 
offense. Once he was reprimanded for day-dreaming and idly 
watching an automatic press when he should have been at work. 
The accusation offended him deeply, and he asserted that he had 
merely watched intently the operation of the press in order to 
locate some particular defect. In telling of this incident he became 
excited and voluble: "How can you study what is wrong with a 
machine without sitting down and carefully watching what is 
going on?" 

As time went on, he became very apprehensive and felt that 
he was constantly being watched. An interviewer who had talked 
with Mr. Cote in the shop, reported the following incident: 

In the midst of their conversation, Mr. Cote glanced furtively 
around and suddenly announced that everyone had been watching 
them for some time. As a matter of fact the interviewer, who 
was already familiar with Mr. Cote's suspicious attitude, had 
kept the other employees in mind. He had noticed, somewhat 
to his surprise, that others in the shop paid little or no attention 
to them. 

Mr. Cote defended his unwillingness to cooperate with his 
superiors by saying: "You must be careful not to be too smart. 
They don't like it and think you are after their jobs. It is their 
business to see that processes are improved, and if I should make 
a suggestion they would think I was finding fault with their work." 

In order to stimulate Mr. Cote's interest, the safety engineer, 
who also administered the company's suggestion system, invited 
Mr. Cote to his office and offered secretarial facilities so that he 
could submit his suggestions according to the prescribed routine. 

On Nov. 11, 1936, Mr. Cote took advantage of this offer and 
dictated several suggestions, which were then forwarded in the 
routine manner. The suggestions were as follows : 

Suggestion 10002 — Use rolls of steel and brass for punching out small 


Reason: To start with, it would be a tremendous saving for it would 
avoid the shearing automatically; and it would give us much better 
service for our standard measurements on width. Not only that, it can 
produce an average of between 100 to 125 per minute with just as much 
accuracy and without the work of an operator. 

Suggestion 10003 — Send last piece run off with each die sent for repair. 

Reason: It is very easy for the die maker to determine what is wrong 
with the die if he can closely examine the sample. It might be drawing 
too deep or too low or not bending at right angles. It saves to start 
with, a setup by the die maker. 

Suggestion 10004 — Shut off all motors and lights of machines while not 
in operation (feeder section). 

Reason: It not only saves the life of the machine considerably, but 
also saves the time of a man running around the shop to find out who is 
operating the machine. 

Suggestion 10005 — Equip all blanking and piercing dies with bushings 
and inserts. 

Reason: At the present we have several dies without the said bush- 
ings with the result that when there is a misfeed and a punch goes out of 
line the next time it comes down into the die it will eventually break, or 
shear the die ^$2 or K6> which means grinding it down until we reach 
cutting surface. On the contrary, with the bushings it would save 
that 3^6 and the die would not have to be disturbed. Time to make 
that bushing would perhaps be 30 minutes or less. 

Suggestion 10006 — Equip all milling machines with keys and bolts. 

Reason: At present, we have to take our milling machine bolts out on 
check. Sometimes, there is quite a crowd at the tool crib, resulting in a 
tremendous amount of time lost. 

These suggestions were considered in the routine manner. The 
following gives the date and nature of the dispositions : 

Suggestion 10002 — Rejected 2/24/37. 

Reason: This suggestion is not original. It has been proposed a 
number of times and is used whenever advisable. This method is made 
use of at the discretion of the tool design and punch shop supervisor, 
taking into consideration the cost of changing over dies, application of 
strip stock, and the quantity on order. 

Suggestion 10003 — Adopted for a trial period. If permanently adopted 
an award will be made. 2/24/37. 

Suggestion 10004 — Rejected 1/14/37. 


Reason: This suggestion is not original, as the management is con- 
tinually stressing this point of economy. It is the function of the 
department supervisor to insist on this practice being followed. 

Suggestion 10005 — Rejected 2/24/37. 

Reason: This method has been used for some time on some of our 
dies. It is standard practice to adopt this wherever possible, but is 
more or less left to the discretion of the tool design men to decide when 
and how these bushings should be used. 

Our present system does not permit of a unified method of design. 

Suggestion 10006 — Rejected 2/24/37. 

Reason: The bolts referred to are supplied as regular equipment and 
are to be supplied by foremen when advisable. This is an old practice 
and periodically the department foremen reequip all machines with 
these bolts. 

The trouble indicated by you is due to the regular milling machine 
operators locking the bolts up in their drawer or tool box, or using them 
for other purposes. It is the duty of the milling machine operator to see 
that his machine is properly equipped. 

On July 1, 1937, Mr. Cote was transferred to the machine 
repair section of the toolroom as second-shift repairman. 

Mr. Cote complained to the employment manager that this 
new assignment was handicapping him in every way: 

1 . Machine repair work was paid on a daywork basis. This meant 
that by going off incentive work, he lost the opportunity to earn more 
money by increasing his output. 

2. There was little opportunity for a second-shift man in the repair 
section to show his superiors that he had executive ability. 

3. Machine repair work did not give him an opportunity to demon- 
strate that he was capable of doing cost-reduction work and die 

He was advised to accept the transfer until his case had been 
given further consideration. 

On July 2, 1937, Mr. Cote made a formal complaint through 
Mr. Cameron, president of the union. He complained that he 
was discriminated against by being transferred to the machine 
repair section at a reduction of approximately $10 to $12 a week. 
Mr. Gordon, toolroom foreman, Mr. Wellman, union representa- 
tive, Mr. Cameron, and Mr. Cote, met at 3:00 p.m. that 
afternoon in the office of the industrial relations supervisor. 


Gordon: (to Avery) The reason for transfer was that die repair work 
had considerably lessened in the last few weeks. The charge of 
discrimination is absurd because the transfer was more to keep the 
man at work than anything else. We don't really need any more 
people on machine repair work, but due to the nature of the work 
we can always carry a fellow along for a few days or a week. 

Cote: I want a chance to earn more money. I want to get into the 
toolroom on incentive work, back on standard time. My wife has 
just had another baby and quite a few bills have piled up. 

Avery: I think we shall be glad to give you an opportunity to get on 
standard time when standard time work is available. On the 
other hand, you've heard what Mr. Gordon just said. He's keep- 
ing you at machine repair work rather than allow you to be laid off. 

Wellman: There's no doubt in my mind that Cote's been treated 
fairly. If you ask me, he's always crabbing about one thing or 
another. I told him so and told him he was crazy to bring the case 
up here. He's always talking about justice and insists that as a 
union representative I should fight for him. I told him that I 
would fight if there was anything to fight about. 

Avery: Well, I don't think there is any reason why we should talk about 
this case any more. 

(to Mr. Cote) I can tell you this, we'll give you every chance to get 
back on incentive work; we'll let you know the first opportunity 
that presents itself. 

Cote: That's all I ask. 

The foreman who was responsible for the transfer made the 
following statement to the interviewer: 

Mr. Cote was working on the maintenance of dies. When 
work was slack in that department he was sent to do machining 
but failed to make standard time. His work, furthermore, was 
not very satisfactory. It was decided to transfer him to the 
machine repair section rather than lay him off. Furthermore, 
machine repair work, being day work, was better suited to his 

The foreman went on to say that Mr. Cote was his own worst 
enemy. He was disliked for talking too much. His fellow work- 
ers complained that he neglected his own job in order to criticize 
their work and elaborated at great length on his own talents and, 
superior ability. Cote was shunned by his fellow workmen not 
only because he continually bragged about his own prowess but 
also because he burdened anyone who cared to listen (and even 
those who did not) with dramatic recitals of his personal 
affairs. The toolmakers had also resented his free and easy 


habit of opening anyone's toolbox and borrowing tools without 
permission . 

On July 30, 1937, Mr. Cote appeared at Mr. Avery's office door: 

Cote: Mr. Avery, can I take just a minute of your valuable time? 
Avery: Yes, Mr. Cote, sit down. What's on your mind this time? 
Cote : (pulls out of his wallet a letter addressed to him by the business 
agent of the union and reads). 

As a result of our recent meeting with the industrial relations 
department and through our efforts in your behalf the industrial 
relations department has agreed to give you a job on incentive 
work as soon as an opportunity presents itself. 

(s) Business Agent 

You remember when I met you before? You know my name, 
Mr. Avery? 

Avery: Yes, I remember your case thoroughly, Mr. Cote. 

Cote : Well, you see so many people every day that I thought you had 
forgotten me 

Avery: No. I remember your case quite well. What's on your mind? 

Cote: Well, I haven't had this chance yet, and I'm told that I'm going 
to be laid off next Friday. I don't like the way I was told, either. 

Avery: Tell me more about the details. I haven't heard anything 
about your case recently, and naturally I want to hear both sides 
of the story. 

Cote: The other day my foreman told me that I would have to see 
Mr. Rankeillor because he would have to lay me off next week. 
Mr. Rankeillor told me that Mr. Kennedy in the Refrigeration 
Laboratory wanted four mechanics and I could go over there and 
see Mr. Kennedy and talk to him about getting one of the jobs. 
Well, I went over and talked to him. He said he wanted four all 
round machinists. He said he would think it over and let me 
know. Today he told me he couldn't take me. I know he has 
been checking up on me in the toolroom and all of a sudden he don't 
want me. What is this? I think this is just a nice way to get rid 
of me. It seems that ever since I came to Mr. Hanson's office and 
put in all those suggestions, I've been out of place. I think 
Mr. Kennedy knew all about my story before I went to see him and 
Rankeillor was just giving me the good old run-around. 
Mr. Avery, can't you leave me where I'm now? I don't want to 
cause any trouble. I got three small children. I got to think of 
them. My credit is good everywhere except in this place. Why, 
the other day I just walked into the bank and told the man that 
I needed $120 to pay the hospital bill for my last baby just born 
two weeks ago. My wife had a hard time and it cost me a lot of 
money. All I did was to tell the man the story and I got the money 


just like that. That's what people think of me in the city. But 
here I seem to be out of place. 

I talked to Mr. Kendricks the other day, and he insulted me. He 
told me, I talk too much; that's my trouble, said he. I feel like 
punching him in the nose. You know my French nature don't 
stand for no insults. I can't help it, when people talk to me like 
that, I get mad. I should have punched him in the nose. 

Avery: Now wait a minute, Cote. There's one thing I want to get 
straight with you right now. I want you right now to cut out this 
talk about punching people in the nose. That doesn't do you or 
anyone any good. You'll never get anywhere with that kind of 
talk. So don't talk any more about punching people in the nose. 

Cote: (starting to cry): I'm sorry, Mr. Avery. I want to apologize. 
I can't help myself when I think of my kids and my family. 

Avery: Now listen, Cote, let's talk as man to man. You don't have to 
apologize to me for anything. Somehow you got it into your head 
that somebody is always down on you. Now all I'm interested in 
is finding out that you have been treated fairly. All the times that 
you and I have met together it's always somebody else that's in the 
wrong. You are never wrong. Did you ever stop to look into a 
mirror to see whether there's anything wrong with yourself? I've 
always found this a good rule to follow. If one or two people don't 
like you, don't worry about it. But if everybody is down on you, 
it's time you looked into a mirror to find out what's wrong with 

I know that work is slackening in the shop and we're having a hard 
time finding work for everybody. My department has given your 
case more attention than any other case that I know of, and we 
fully intend to see that you're treated fairly. We will try to keep 
you on the job somewhere, but I can't begin to pick jobs for you. 
Furthermore, you've got to get it out of your head that everybody 
is down on you for no reason whatever. I gather that your skill 
in your field is not as exceptional as you think it is. But your 
greatest difficulty seems to be getting on with other people. 
Apparently you just can't resist telling your fellow workmen how 
to do their job. You'll never get along with people that way. 
You've got to learn, whether you do it here or somewhere else, to 
buckle down to your own job and keep at it. I'll look into this 
case further, and I'm going to see that you're taken care of fairly. 
In regard to this laboratory transfer; Mr. Kennedy has every right 
to look around and select any employee he chooses. His work is 
very fussy; it's on daywork and requires a lot of experience 
because the work is so diversified. That's why you see so many 
of the older men there. No doubt he's found out that your work in 
the toolroom doesn't indicate this standard and he's perfectly 
justified in not taking you on if he's not satisfied that you're the 
man he wants. 


And then about those suggestions of yours: Please get it out of 
your head that you're being persecuted on their account. The 
foremen don't even know that you ever put in a suggestion. 

Cote: All I want is justice, Mr. Avery. 

Avery: I'm sure no injustice has been or will be done to you. Mr. 
Kendricks has followed your case with the greatest interest, and 
if you only knew it is really a friend of yours. I'm quite sure that 
you don't have to worry. You'll be treated fairly. 

Cote: All right. I'll wait and see. 

Case 43. The Corelli Case 

(Difficulties of a demoted group leader.) 


Mr. Corelli, demoted group leader. 

Mr. Avery, supervisor, industrial relations. 

Mr. Leonardo Corelli was above average in intelligence, a 
Protestant Italian, thirty- two years of age, who had at one time 
studied for the ministry. At the age of nineteen he became an 
industrial worker (temporarily as he thought) to earn money for 
his anticipated college expenses. After five years, during which 
he had not been able to save enough for a college education, he 
gave up this plan. Instead, he entered a Methodist missionary 
school in the South. Accordingly, from 1922 through 1931, he 
worked at the factory only from June to September as motor 
repairman. For his spare time he accepted preaching engage- 
ments in rural parishes. During lunch hours he also conducted a 
few revivalistic meetings at the factory. These were ridiculed 
by his fellow workers and soon abandoned. 

For personal reasons he did not complete his studies at the 
missionary school, and from 1932 on he decided to continue per- 
manently as an industrial worker. His next position was that of 
electrician's helper in the maintenance department. On June 29, 
1936, he transferred to the test department as tester. On July 
3, 1936, he transferred again and secured a position as assembler. 
In October, 1936, he was promoted to the position of group leader 
on the third shift. Nine months later he was demoted. The 
reason given was his lack of supervisory ability. A few weeks 
later he obtained a transfer to the feeder section. 

At the time of the following interview he had just entered an 
evening course in industrial management at the LaSalle Institute. 

On Thursday, July 1, 1937, Mr. Corelli came to Mr. Avery 
for advice. He was so excited that it was some time before he 
could speak coherently: 

Avery: Well Mr. Corelli, what can I do for you? 
Corelli: Oh, Mr. Avery, if something isn't done right away, I'll go 
crazy. I'm at my wits' end. Please tell me what to do. 



Avery: Oh come, it can't be as bad as all that. Take a chair and tell 
me what's on your mind. 

Corelli : Thank you. You're very good to let me talk to you without 
an appointment and all. But I just simply got to talk to some- 
body. I can't understand why this should happen to me. People 
might think I was the thief when all I tried to do was to make 
them see that it was wrong to lay down on the job. Anybody 
with the smallest spark of decency could only do as I did. . . . 

Avery: Have a cigarette, Mr. Corelli, and have a little smoke before 
you tell me what this is all about. 

Corelli: Thank you. I think that's a good idea. . . . (Lights a 
cigarette and inhales deeply) 

About nine months ago I was appointed as a group leader and 
got involved in a difficult situation. Men on the night shift on 
which I was working, especially inspectors and testers, went to 
sleep after a few hours of work or else simply went off for a walk. 
Of course, I had no authority over the inspectors and testers, so I 
could not say anything. And whenever I offered a little friendly 
advice they just laughed at me. Pretty soon, some of the workers 
in my group, too, began to shirk their duties and copied the 
behavior of the others. All this interfered with production. I 
reprimanded them and they just said: "What's the use of working? 
We can't get anywhere unless the inspectors and testers check 
on our stuff." 

I reasoned with both my men and the inspectors. I urged that it 
was their moral duty to do the best they could for the company. 
I even had them at my house for a party in an effort to make 
friends with them. I tried to explain to them that it was to their 
best interest to do a good job; but they paid no attention. No 
one, except a graduate from New York University, understood 
what I was talking about. Pretty soon the whole group was 
snickering. Some of them even told me to go to hell. There 
was nothing I could do to remedy the situation. 
When I was called on the carpet for not getting out production, 
I went to the foreman and explained the situation. The foreman 
refused to do anything about it, saying that he could not afford to 
antagonize the foreman of the inspectors and testers. Appar- 
ently his one major desire was to avoid trouble with his colleagues. 
As for me, I felt the behavior of the men was just as bad as stealing. 
If you had put $50 on the table and they took it away, just like 
that (making a sweeping gesture with his right hand), people 
would pay attention. But when they merely neglected their 
work, no one seemed to notice. 

Finally I went to Mr. Kendricks, the employment manager, and 
asked him for advice. Mr. Kendricks gave me some very valuable 
advice and told me to let things alone for a while, maybe they 
would straighten themselves out. He suggested that I allow the 


situation to explode rather than explode myself. I followed this 
advice for a while, but pretty soon things became worse and worse. 
I was also feeling that my character was. disintegrating if I allowed 
this sort of thing to occur under my supervision. For many days 
I hardly got a wink of sleep, thinking, thinking what I could do to 
make the men see their mistake; to find a way in which I could 
gain their cooperation and bring them back on the right path. 
I prayed for guidance. All in vain. So I finally went to Mr. 
Hastings, the general foreman. I told him my predicament and 
asked for help. But Mr. Hastings was very impatient and without 
regard for me, he decided to settle the thing in his own way. He 
called all the men together and exposed the situation. What was 
the result? The offenders kept their jobs and I lost mine as a 
group leader. Evidently, Mr. Hastings seemed to feel that he 
would rather have one dissatisfied employee (namely me) than 
many. So I was in disgrace. Naturally I did not want to stay 
in that department and got a transfer to the feeder section. 
But what's the use? The men in my new department met me 
with much antagonism. They seemed to think that I was a stool 
pigeon and refused to work with me. I was so upset about this 
all that I became ill. I even felt at one time that I would do away 
with myself physically. Where is the justice of it all, I ask you? 
Here I was trying to do the best I could for the company and for 
the men, too, if they only had brains enough to know it. What 
was the result? Everyone shuns me as if I were a leper. 
I explained the situation to the workers but they only laughed at 
me. They neither know nor care what the facts are. They 
rather have somebody they can kick around. 
The union representatives refuse to do anything about my case. 
I've talked to them and they say that they will not be a party to 
any action which is designed to make men work harder. What 
d'you think of that? And they are supposed to be our represent- 
atives. I told them that in such a case I felt that I could no longer 
accept their philosophy. But all they say is, "so what?" 
In talking to the union representatives, the works manager once 
said that honesty still counts for something. I believed this, but 
apparently this is not so. No one gets hurt except myself. 
I don't know what to do. I almost feel like throwing up my job 
and doing away with myself. But as a last resort I have come to 
you for advice. 

I think a group leader is in a difficult position. If he doesn't get 
out production, management will call him on the carpet. If he 
exposes unsatisfactory conditions that interfere with his getting out 
production, he's hated by the men and abandoned by the union. 
How can he tell what course he has to steer? I think group leaders 
ought to have a chance to meet with each other in order to talk 
over their problems. They do have problems, you know. They 
may not admit it to management, but I know they have. Perhaps 


I was hasty in my uncompromising attitude. I found that out to 
my cost. But what can I do now? If no one is willing to work 
with me, how can I earn a living, how can I show them that I want 
to do the best I can? 

When I went to school I used to have a social ethics teacher who 
told us how the workers were exploited and used as machines. 
But now that I have some industrial experience I know that this is 
somewhat exaggerated. Some workers may show the right spirit 
but many of them think of nothing but how they can get by and 
how they can cheat the company. This is very discouraging. I 
can't see how men can complain at one time that they are not paid 
enough for their work and how at the same time they can con- 
sciously cheat the company by laying down on the job. I would 
like to write about my experiences and publish them in the union 
paper to let the workers know what they're really like. But I'm 
afraid that the union would not publish these articles. Nothing 
hurts so much as the truth. 

So what's the use ? There's nothing I can do. What is to be done ? 
Do you think there's any use in my staying here? 

Case 44. Case of Deborah Larkin 

(A transferred inspector with long service insisted that she should be placed on the 

first shift.) 


Miss Deborah Larkin, inspector, 48 years of age. 

Mr. Ovtedo, business agent of the union. 

Mr. Avery, supervisor, industrial relations. 

Mr. Dunstable, interviewer, womens' employment. 

On July 8, 1937, the business agent, Mr. Oviedo, called Mr. 
Avery (supervisor of industrial relations) on the telephone and 
asked for an interview saying that he was bringing with him an 
employee who deserved special consideration on account of her 
long service. A meeting was arranged: 

Oviedo: Mr. Avery, I though this was a worthy case to bring to your 
attention, and I wish you would listen to her complaint, 
(to Miss Larkin) Will you tell Mr. Avery your story? 

Larkin: Well, I worked in A-29 as a tester for 15 years, and I was 
always on the first shift. When I heard that Motors were going to 
Cleveland, 1 1 was worried and asked whether I might be transferred. 
I asked my foreman, and he said he would see what he could do. 
It wasn't going to be easy because A-29 was shutting down within 
two weeks, and we were all going to be laid off soon. A little later 
the foreman told me to go over to the employment department. 
There they told me I had to take a second-shift job. I didn't 
know what else I could do, so I took it. Now I've been working 
for the last three weeks on the second shift in the refrigerator 
department. I don't like the second shift, and I don't believe I'm 
getting proper treatment, because I've been here 15 years, and 
I think I ought to have some pick of my job. I live alone with my 
sister at home, and she works in a restaurant down the street. 
She works in the afternoon and late at night. This makes it hard 
for us to keep our house clean and I like to work on the first shift 
because I can be home while she is away. 

Avery: Let me call Mr. Dunstable (interviewer, womens' employment), 
and see what he has to say. (Calls Mr. Dunstable.) 
Do you recall Miss Larkin, Mr. Dunstable? 

Dunstable: Yes, certainly, (to Miss Larkin): How do you do? 

Larkin: How do you do? 

Avery: What information have you got on Miss Larkin's case? 

1 Management had decided to transfer its small motor division to Plant No. n. 



Dunstable: About three weeks ago, Mr. Hobbes came to my office with 
a layoff list to tell me that a number of girls with long service were 
going to be laid off. He asked if I couldn't place them in the 
plant before the actual layoff. I told him I would do my best. An 
hour later, Miss Larkin came in to ask what I was going to do for 
her. She said I had to do something because she had such long 
service. I told her that I would do all I could, but that it would 
take a little time for me to look around and see what kind of work 
we could put her on. She said that she wouldn't consider any 
other job than a test or inspection job, and that she knew of plenty 
places where I could put her, and that there were plenty of girls in 
other departments with less service whom I could lay off in order 
to give her the preference she deserved. I told her that I would 
look into the situation and let her know. Three different times 
that day, she came to see me, asking what I had done. Each time 
I let her know that so far, I didn't have a chance to do anything 
but would attend to her case as soon as I could. I told her she 
needn't worry, we would keep her on where she was until a job 
had been found. We did keep her on in the department for 
more than a week. I finally made a place for her as inspector on 
the second shift by laying off a junior who had only been with us a 
short time. She took that job but every day since that time she 
has been in to see me about a transfer to the first shift. It is 
difficult to find her a job at the same rate of pay on the first shift 
because she's not as speedy as the other girls. I've offered her 
several other jobs on the first shift, as bench worker or assembler, 
but she won't take them because they are production jobs. 

Larkin: There are plenty of other girls on that shift who have less 
service than I, and I don't see why you can't transfer one of them 
and put me in her place. 

Avery: We are doing all we can for you, Miss Larkin. After all, you 
haven't lost a single day's work in this transfer, and we made sure 
that your new job was at the same rate of pay. This shows that 
we are giving every consideration to your service record that we 
can. Furthermore, we are going to find a place on the first shift 
for you. Only, you must realize that for several reasons this is not 
so easy. In the first place, you definitely limit the possibilities by 
specifying the type of work you want. Secondly, you cannot 
expect that the foreman should jeopardize production by releasing 
highly efficient girls who have learned to work together in his 

Larkin: Well, anyway, Mr. Dunstable didn't tell me of any other jobs 
on the first shift. 

Dunstable: I am sorry you take that attitude, Miss Larkin. But if 
you will recall, I showed you three jobs on the first shift. One of 
them was a job as bench worker, the others were assembly jobs. 

Oviedo : Miss Larkin, I think this is all beside the point. I am certainly 
convinced that management is trying to place you. And please, 
don't let us waste our time. I have plenty of other cases where 


people have not been as fortunate as you have been. They are 
losing time and money by this transfer and would gladly take any 
job. Mr. Avery has told you that he will continue to try to place 
you on the first shift, and I certainly don't want him to fire anybody 
to do this. 
Larkin: Well, please do everything you can, Mr. Avery, and do it 

quickly, will you? I want very much to get on the first shift. 
Avery: I'll do everything I can, Miss Larkin. I suppose you wouldn't 
be interested in taking a job as charwoman on the first shift? We 
can make a place for you in the office building. 
Larkin: Certainly not. I couldn't consider that. 
Avery: Well, give us a few weeks to turn around in. Come in to see me 

Monday, July 26. Will that be all right? 
Larkin: Oh, yes, indeed. 

July 21, 1937 
Deborah Larkin 
Industrial Relations 
Mr. J. Avery, Supervisor 

On the case of Deborah Larkin which you asked for a report on, 
I have talked today with Mr. Masters concerning her case and have 
the following explanation to offer as to why it is impossible at the 
present time to transfer her onto the first shift. 

She is on a job especially suited for her as it is a simple meter 
reading occupation on the stators in Department L-50. Mr. 
Masters does not feel he could transfer her to any other type of 
work and on the particular job on which he is working the two girls 
on the first shift have both more than five years service on that 
same occupation. In Mr. Masters' estimation, both girls on the 
first shift are more valuable to him and he could not legitimately 
transfer one of them to the second shift without endangering 

Mr. Masters has gone over this with Miss Larkin and has 
absolutely guaranteed that the first opening on any occupation for 
which she might be suitable, he will place her immediately. 

Under these circumstances I cannot see how we can be of any 
assistance to her at this particular time unless we can place her on a 
bench job on some easy occupation. 

H. N. Dunstable 
Employment Department 

July 22, 1937. Miss Larkin in Avery's office. 

Avery : Miss Larkin, we must come to some definite understanding on 
your case. You have had more consideration than any other 
employee and yet you continue to make trouble. 

Larkin: (Fumbling for her handkerchief) Oh, Mr. Avery, you're not 
angry with me, are you? 

Avery: Well, I'm not exactly pleased. You have agreed to give us 
time to turn around in to find you a job on the first shift. But 


instead of living up to this agreement you make matters worse 
by appealing to everybody in sight to do something about your 

Larkin: (In tears) I don't know what you mean, Mr. Avery. 

Avery: I mean just this — your case has bobbed up in this office every 
single day since we came to our agreement, July 8. You have 
talked to four people since you've been up here — Cameron (presi- 
dent of the union), Oviedo, and two representatives. If there is 
something that is not clear to you, why don't you come to us? 

Larkin: I didn't want to bother you. 

Avery: Why bother them? Besides, by talking to them you bother 
both them and me. Naturally, they have to take some action, 
and the only way they can do that is to come to this office. And it 
isn't as if we are neglecting your case entirely. We gave you all 
possible consideration because we appreciate that you have 15 
years of service. We even fired a boy to make a place for you. 

Larkin: Fired? 

Avery: Yes, we fired a junior to give you your present job. And your 
foreman has absolutely agreed to place you as soon as he can find a 
job for which you are suited. Why don't you give him a chance? 

Larkin: I do. 

Avery: I beg your pardon. You're not helping us a bit by misrepre- 
senting your case to the representatives. 

Larkin: Oh, I didn't do that. 

Avery: Well, you certainly had Dunstable on the spot by telling one of 
the representatives that he was not taking any interest in your 
case. What d'you expect the representative to do when you tell 
stories like that? He naturally comes right to this office to find 
out why nothing has been done. More than that, you told 
Mr. Cameron that we didn't even want to give you the charwoman 
job on the first shift. Now you know that this isn't true. You 
can have the charwoman job right now. I didn't stress the char- 
woman's job because I knew you wouldn't like it. Cleaning 
toilets is different from what you have been doing before. 

Larkin: Oh, I wouldn't mind cleaning the toilets for the office people so 
long as it isn't in the shop. 

Avery: All right. I am ready to transfer a woman from the office 
building in order to give you the job. 

Larkin: Oh no, I have no right to ask that. 

Avery: Well, you have 15 years of service. You have a right to get 

Larkin: Well, I don't know. I'll wait till Monday. 

Avery: I think that's the best thing. If you will only wait a little 
while, I am sure we can find a place for you. Mr. Masters has 
promised. . . . 

Larkin: (Evidently anxious to be gone) Yes, he was very nice to me, 
and I'm sure. . . . 

Avery: Well, give him a chance. Your best bet is in the refrigeration 
department, because the work there is steadier than anywhere else. 

Case 45. Mitchell Case 

(Unexplained difficulties in the engineering model shop.) 


Mr. Miller, foreman, engineering model shop. 

Mr. Avery, supervisor, industrial relations. 

Mr. Smalley, friend of an employee with personality difficulties. 

Mr. Kendricks, employment manager. 

On June 24, 1937, Howard Miller, foreman, engineering model 
shop, came into the office of Mr. Avery, the industrial relations 
manager, and asked if he could get some help on a problem in his 
department : 

Miller: Jim, I feel that I'm not getting anywhere with the fellows in 
my department. There's a lot of monkey business going on, and 
I can't seem to get to the bottom of it. 

They're all little things and no one of them is really serious, but all 
together they are disturbing as showing poor morale. For 
instance, the other day, half a dozen tools were lost. We finally 
found them behind a box in the storeroom, apparently hidden by 
somebody. Yesterday we found several broken taps in a fellow's 
drawer. Knowing the fellow as I do, I know he didn't break the 
taps. They were deliberately placed there by somebody else. I 
have an idea who it is, but I can't pin it on him. The fellow is kind 
of slick, and I'm sure when somebody is fired, it won't be him, 
because this guy is slick enough to make sure that somebody else 
has to take the rap. 

Our organization over there is small, as you know. All the fellows 
have been with us a long time and we've always been a happy 
family until this damn union started. 

Avery: How are your rates of pay, Howard? 

Miller: O.K. I'm sure. A few months ago we reviewed them all, and 
I discussed every case with each individual. They all appeared 
to be satisfied. 

Avery: Who do you think is causing all this? 

Miller : Oh, between you and me and the lamp post, I think Sprague is 
at the bottom of it. 

Avery: Isn't Sprague the union representative? 

Miller: No, he isn't now. They kicked him out about a month ago. 

Avery: Out of the union? 



Miller : No, out of the job of representing the department. But, come 
to think of it, he did hold some kind of an official position in the 
union. He lost that at the same time. 

Avery: Does he still pay his dues? 

Miller: Yes, I believe he does. At least he wears his union button. 

Avery: Do you have any nonunion members in the department? 

Miller: Yes, we have two, a fellow by the name of Smith and a fellow 
by the name of Mitchell. 

Avery: Well, do you think that might be the cause of your trouble? 

Miller: Yes, it might. 

Avery: Has either of these boys been approached to join? 

Miller: Yes, they have, long before they came to work for me, though. 
They don't want to join. Smith happens to be a friend of mine. 
I have known him for a long time and I think the fellows feel that 
he is a bootlicker. But there's nothing to that. He's just as 
square as he can be. He is quiet and unassuming and knows how 
to mind his own business. 

Avery: How about Mitchell? 

Miller: Well, you know Mitchell, Jim. He's the guy that was made a 
foreman some time ago but was taken off the job soon after. I 
understand promotion went to his head a bit, and he couldn't get 
along with the fellows. They said he was too cocky; that as soon 
as he was made foreman he strutted around like a peacock and 
didn't know his own brother. 

Avery: Maybe he is the fellow you're looking for? 

Miller: No, I don't think so. It's true he's kind of blunt and doesn't 
hesitate to speak his mind, but generally he's well thought of. 
He's got a good reputation among his own crowd. In fact, he 
headed up the lodge last year. 

Avery: Well, I don't know what to tell you, Howard. Suppose you let 
me think it over, and if I can find any solution I'll let you know. 

Miller: O.K., Jim. But couldn't we transfer Sprague out of the 
department? He's a good mechanic and it wouldn't be too 
obvious if we transferred him to a light job where he could earn as 
much money as he's making now. 

Avery: No, I don't think that would be wise. Remember you must be 
able to prove your case up to the hilt and so far we have nothing 
tangible. . . . Let me think it over. I do remember something 
about the Mitchell case that might have some bearing on all this. 
But I'd like to make sure. 

On June 28, 1937, Howard Miller again came to Avery's office, 
quite perplexed: 

Miller: Jim, a funny thing happened Saturday. I was just about 
ready to leave the house when Mrs. Mitchell came into the drive- 
way with her children. She wanted to know what was the matter 
with her husband. She said he had not been able to eat or sleep. 


And he won't tell what's troubling him. I told her I didn't know 
what the trouble could be. There had been some mixup in the 
shop, but I couldn't see how that had anything to do with him. I 
told her not to worry, and that he would probably be all right by 
Monday. This morning when I came in to work, Mitchell came 
over and asked if he could talk to me. We went upstairs to the 
conference room, and I found him in a very nervous state of mind. 
He was actually jumpy, I tell you, and could hardly speak without 
quivering. I feel he's heading for a nervous breakdown. For one 
thing, he told me that everything that had happened in the lab. was 
his fault and wanted to know what he could do about it. He was 
almost in tears when he said, "This is all my fault. I believe I'm 
losing my mind. What can I do to square myself with the men? " 
I told him that if he was in any trouble with the men in the depart- 
ment, the best thing for him to do to clear his conscience was to go 
out and apologize to all of them. He agreed to do that but said he 
simply couldn't apologize to Sprague. The very idea of apologiz- 
ing to that man upset him terribly. D'you think I was right in 
giving him this advice? 

Avery: Yes, I do. This may be the answer to your problem. Let's 
check up on Mitchell's previous record and see if we can find out 
what is wrong. I know a personal friend of his, Smalley. It 
might be a good thing to call him in. 

Miller: Let's do that. 

Mr. Avery telephoned Mr. Smalley and asked him to step into 
the industrial relations office for a minute. 

Avery: Mr. Smalley, you have known Mr. Mitchell for quite some time 
haven't you? 

Smalley: Yes, I have. He's been a personal friend of mine for more 
than fifteen years. 

Avery: Have you seen him lately? 

Smalley: No, I haven't seen him for a week or two. Why do you ask? 

Avery: Well, I would like to talk to you about him. He has been 
acting queer lately, and Howard Miller, here, thinks he is headed 
for a nervous breakdown. 

Smalley: What d'you think is the trouble? 

Avery: I don't know, but he seems to be worried about things in the 
department and the people in it. He came to us this morning very 
much broken up and confessed to being responsible for everything 
that happened, and we don't know just what he is talking about. 
But apparently he feels that he owes his fellow workmen an apology 
for something he has done. 

Smalley: Well, I can easily imagine that. You know, if I hadn't 
known Mitchell over all these years I could easily get mad at him 
any time. He's so damn blunt the way he says things. Often he 
doesn't know what he's saying and is always getting himself into 


trouble. And he doesn't know enough to keep his mouth shut. 
Whatever happens, he always has to tell half a dozen people about 
it before he's through. I think I would have had the right to 
punch his nose at least a hundred times in the last couple of years. 
Many times he's so irritable and abusive that you can hardly help 
taking a good sock at him. And ever since he lost that foreman job 
he's been more irritable than ever. Then there's another thing. 
He took it awfully hard when his mother died this spring and can't 
seem to get over it. 

Avery: Well, thanks, Mr. Smalley. If you see Mitchell I wish you 
would have a talk with him. Maybe you can help him work out 
his problems. 

Smalley: (going out) O.K., I'll be glad to do that. 

On June 29, 1937, Miller came into the industrial relations 

Miller: Well, Jack, what d'you think of that? Mitchell quit on us. 

Avery: Oh he did, did he? What happened? 

Miller: Well, yesterday afternoon he went around and apologized to 
everybody with the exception of Sprague. He apologized for what 
he had done and said. I asked him why he didn't apologize to 
Sprague, and he said that he didn't have nerve enough. I tried 
to tell him that the best thing for him would be to get the whole 
thing off his chest. But he refused and said he wanted to quit. 
He said, "I'm going to quit. I got to. That's the only way I can 
straighten things out." I argued with him that it was foolish to 
quit and that I was sure the whole thing would blow over. But he 
insisted that he wanted to get out of here. Then I asked him if it 
would not be better for him to shake hands with Sprague before he 
left. He did this after a while, then insisted that I go and check his 
tools and give him his pay. He was in such a hysterical condition 
that I didn't know what to do. So I made out a quit slip and 
walked out of the shop with him. However, I refused to let the 
quit slip go through. I knew the man was not accountable. So I 
talked the matter over with Kendricks (employment manager) and 
we agreed to hold the quit slip and his badge. 

The employment manager added the following information as 
to Mr. Mitchell's behavior on leaving the plant : 

Mr. Mitchell came into my office and threw the quit slip on 
my desk. I said, "Why, Cal, you can't mean it. Why do you 
want to leave?" You can't leave without notice and leave Miller 
in the lurch. But he said, "I got to go." 

Kendricks: Why? 

Mitchell: For personal reasons. 


Kendricks : What do you mean, personal reasons. Aren't you satisfied 

with the department? 
Mitchell: Oh, it isn't that. Miller is a fine man. There's not a man 

this side of hell that I'd rather work for. 
Kendricks: Well, why leave him then? 
Mitchell: I've been a bad boy. 
Kendricks: What do you mean? 
Mitchell: I've been a bad boy. . . . Oh, don't talk to me any more. 

If you talk to me I'll cry (his lips quivering), 
Kendricks: Well, Cal, I don't want you to do that. Go home for a 

while and come back tomorrow for your check- 
Mr. Mitchell did not call for his check. Instead, he returned 
the next morning and asked whether he could go back to work. 
He said that he had talked the matter over with his wife and 
brother, and that they had persuaded him not to give up his job. 
Mr. Kendricks called in the foreman and both decided to send 
Mr. Mitchell away on sick leave. He was to rest up in the coun- 
try and was assured that his job would be waiting for him on his 

Case 46. The Bowditch Case 

(Conflict between a union representative and a transferred employee.) 

Characters : 

Mr. Poole, union representative, inspection department. 
Mr. Avery, supervisor, industrial relations. 
Mr. Simpson, foreman, inspection department. 
Mr. Bowditch, inspector, inspection department. 

On Dec. 16, 1937, at 2:30 p.m., George Poole came to the 
National Manufacturing Company's industrial relations depart- 
ment with a formal complaint card and asked the secretary whether 
he could talk to Mr. Avery. The secretary arranged an immediate 

Poole: Mr. Avery, I've a complaint to make. I think we ought to get 
Mr. Simpson over here. 

Avery: Wait a minute, Mr. Poole, let's see first what the complaint is. 
Maybe Mr. Simpson ought to handle it out there. 

Poole: Well, here's the story. We have a fellow there that makes a lot 
of mistakes — bad ones, too, in the count of material. As a matter 
of fact, groups have complained several times that they were short 
in their pay, all because they didn't get credit for work they had 
performed. I've talked this over with Mr. Simpson several times, 
and we have agreed that the man is not fit for this type of work. 
He came to us on a transfer and really isn't an inspector anyway. 

Avery: Well, just as I thought, Simpson can handle that. If the man 
is not fit to do the job, the foreman should send him back to the 
employment department. 

Poole: I know all that, but this fellow got personal. 

Avery: What do you mean " personal"? If it is just a private matter 
between you and him, I'm not interested in getting mixed up in 
any personal fights. 

Poole : Well, it isn't personal in that sense. The fellow came to me and 
wanted to know whether I was for him or against him. He said 
that it was my duty as representative to back him up and not fight 
against him. I asked him if he belonged to the union. He said, 
"Sure." As a matter of fact, he hasn't paid any dues for seven 
months. This automatically drops him from the union. Not that 
it makes any difference to me, you understand. If he was in the 
right, I would have backed him up, and if he's wrong, I wouldn't. 
So, knowing that he couldn't handle the job, I told him that I 



couldn't do anything for him. Then this fellow folded his hands 
like this (illustrates by clasping his hands) and said, "Well, you 
wouldn't do anything for me anyway because you and the foreman 
are just like this." Now, I don't think a fellow ought to be 
allowed to talk that way, accusing me and the foreman of being in 
collusion. I think he ought to be dropped from the department 
for behaving like that, or, at least, he ought to apologize for talking 
that way. 

Avery: Well, Poole, I don't see why I should get mixed up in any 
dogfights. I still think this matter should be settled between you 
and the fellows and the foreman right in the shop. 

Poole: But Simpson won't do anything about it. He says this is 
personal and has nothing to do with production. Wouldn't it be a 
good thing to get him over here? 

Avery: No, I'll tell you what I'll do, though. I'll call Simpson on the 
phone and ask him why he can't settle this matter out there. It's 
part of his job, and he ought to attend to it. 
(Calls Simpson on the telephone.) This is Jim. . . . Avery, 
industrial relations. Say, I have one of your men up here. I guess 
you know what it is all about. Why can't you settle this affair 
out there? 

Simpson: (Over the telephone) Well, we have. But this matter with 
the representative is personal and I think it ought to be settled over 
in your office. I'd like to come over and bring this fellow, 
Bowditch, with me. 

Avery: Well, all right. If you want to, come right over. 

The foreman brought Inspector Bowditch into the industrial 
relations office. There was an exchange of greetings between 
Simpson and Avery, but no communication between Simpson, 
Bowditch, and Poole. Bowditch seemed worried and ill at ease. 
He kept shifting his weight from one foot to the other and twisting 
his cap in his hands. Representative Poole stood with his back 
to Bowditch and facing Avery who was seated at his desk. Simp- 
son was sitting next to Avery. 

Simpson : (To Avery) I thought you ought to know all sides of this story 
so I brought Bowditch with me. After I tell what I know, Mr. 
Poole can pick up from there. 

Simpson: We took Mr. Bowditch from the small motor job 1 knowing 
that he wasn't an inspector, and that it was our job to try and make 
him one. He had six years of experience as a J. & L. operator 

1 In the fall of 1937, the small motors division of the National Manufacturing 
Company had been transferred to a new Midwestern location. Of the 1,058 workers 
employed in this division, 18 elected to follow their jobs to the new plant. The 
1,040 employees who were left behind were divided into three groups: 

a. Employees having service of 10 years or more (292). These workers were 
transferred to positions in other divisions and as far as possible placed on jobs that 


(Jones and Lamson Chucking Machine — skilled job) and was 
entitled to some consideration. He is an excellent machine man 
but keeps on making clerical mistakes. We have talked to him 
about this but he didn't improve, and finally we decided that he 
wasn't the man for an inspector's job and that he ought to get back 
to the machine. So I went to the employment department and 
told Kendricks (employment manager) that he would have to take 
him back. At the present time we are merely keeping him on the 
job until the employment department finds a more suitable job for 
him. That's the story so far as I am concerned. Mr. Poole can 
pick up from here. 

Avery: I've already heard Mr. Poole's story, but I haven't heard what 
Mr. Bowditch has to say. 

Bowditch: Well, I suppose I did fly off the handle, but this whole 
change has kind of upset me. And after all, what was it that 
Mr. Poole said to me? I didn't get all of it but it sounded like, 
" We can't be bothered with a bunch of . ..." I didn't get the 

Poole: Well, I don't recall saying anything like that. But Mr. 
Bowditch insulted me, and I think he ought to apologize. He 
hasn't any business to talk to the fellows about me being in col- 
lusion with the foreman. 

Bowditch: Who did I talk to? 

Poole: Well, I guess you didn't talk to anybody that I know of, but 
you told me to my face that the foreman and I were just like this, 
which makes it even worse. 

Bowditch: Well, I guess, I said a little more than I should have. I get 
excited easy. 

Poole: Well, you have no business to say these things. You are new 
in the department, and you don't even know me. 

Bowditch: That's true. That was the first time I ever saw you. 

Poole: That's just it, and all the more reason why you shouldn't say 
such things. You don't know what you're talking about. 

Bowditch: No, I admit, I was in the wrong and I apologize. 

Poole: O.K. I'll accept the apology and am willing to forget what 
happened. I guess that settles everything. 

Avery: (To Simpson) That's that. But I still don't see why this 
couldn't have been settled out in the shop. There's no reason for 
coming here. 

guaranteed a weekly earning comparable to that received in the small motors 

b. Employees having less than ten years but more than three years of service 
(534). These individuals were placed on service work and daywork occupations. 
This meant that their weekly earnings were slightly reduced. Mr. Bowditch's case 
came into this category. 

c. Employees with less than 3 years of service (214). These were laid off. 
Ordinarily, management would have made a great effort to place every man who was 
affected by the move. This was impossible since the small motors transfer coin- 
cided with an unexpected drop in production. 


Poole: Well, Simpson didn't want to take any action because this was a 
personal matter. 

Simpson: I thought it best that Mr. Avery should know about this. 
But I think it's all settled now and we shouldn't take up any more 
of his time. 
(Poole and Bowditch leave the office.) 

Avery: Just a minute, Simpson. Don't you think it would have been 
wise if you had handled this question in the shop, even if you do 
consider it personal? You could have handled it by suggesting to 
Bowditch that, while you didn't want to interfere with personal 
matters, you could not allow this kind of friction in your depart- 
ment and that, therefore, it would be well for him to apologize to 
Poole for the remark made. 

Simpson: I suppose so. But that little tiff was nothing. You know 
this fellow Bowditch isn't as bad as he's painted. I don't want to 
be too hard on him and see him lose his job. Besides, he has a 
wife, children, and owns his own home. He can't afford to lose his 
job. After all, Poole knew that we had no intention of keeping 
this fellow as an inspector. There's a note on Kendrick's desk 
right now, reminding him to find a machine job for Bowditch as. 
soon as he can. I felt if I could only stall this thing along for a 
little while, everything would be all right. I'm sorry that this 
came up. 

Avery: The whole thing is, if you don't settle these questions in your 
shop, how can the men look to you as the natural person in author- 
ity? What did Poole get here that he couldn't have got from you? 

Simpson: Well, for one thing, he had cooled off quite a bit. You should 
have seen how he carried on in the shop. He came to my office 
just before two o'clock; banged his fist on my desk and demanded 
that Bowditch be sent out of the department. I told him that 
I wouldn't take action until I knew what this was all about. Poole, 
then, told me that Bowditch had insulted him and that he wasn't 
going to stand for it. He even brought a witness along to testify 
to what Bowditch had said. I still refused to fire Bowditch 
because it was understood that he would leave anyway as soon as 
we could find him another job. Poole then said, "If you refuse to 
do anything about it, I'm going higher up." So I told him, "If 
that's the way you feel about it, I'm going along." I called your 
office at this time, but you weren't in. Poole hung around for a 
while and finally sent away the fellow who was willing to come 
along as a witness on his own time. 

You see, I thought that the whole thing had really nothing to do 
with what Bowditch had said. My opinion is that the representa- 
tive was riding Bowditch because he hadn't paid his dues. This is 
what happened. Bowditch talked to Poole and he said, "as a 
union representative you ought to fight for me rather than against 
me." Then Poole reminded him that he hadn't paid his dues and 
so he didn't belong to the union any longer. After that Bowditch 


took the stand that Poole should at least leave him alone. He was 
able to handle his own grievance. It was at this time that Poole 
told him, "Sure, I'll leave you alone. . We can't be bothered with a 
bunch of . . . (unprintable language)." Then when Bowditch 
got mad, Poole told him, "Why don't you . . . (unprintable 
language)." That's the whole story and that's why I took the 
stand that this quarrel was personal and had nothing to do with 
the shop. 

Avery: What sort of mistakes did Bowditch make in his work? 

Simpson: Oh, mostly clerical. You see, inspectors have to have quite a 
varied background. They must have good mechanical ability, but 
they also must have good clerical ability. Bowditch is a cracker- 
jack of a machine man, but he gets easily rattled when it comes to 
clerical work. Several times he credited one group with the work 
of another group. For instance, day before yesterday, he credited 
group 130 with 40 hours of work when the work had actually been 
performed by group no. Mistakes like this happen sometimes to 
other inspectors, especially around 2 o'clock when the inspector is in 
a hurry to finish all the work on hand. But Bowditch makes more 
mistakes than the others and doesn't seem to learn by experience. 
He keeps on making the same mistakes. Then there is another 
trouble. There is no doubt that Bowditch had " crashed the gate." 
He wasn't an inspector and came to us on a transfer while other 
inspectors were still out of work. 

Avery: Yes, I suppose that was bad. 

Simpson : Sure, it was. It placed Bowditch in a difficult position. The 
poor fellow had one strike against him already. 

Avery : Say, I wonder if we could have avoided some of these difficulties 
if we had given Bowditch one of our clerical tests before putting 
him on that job. Would you mind if we gave him a test now, just 
to see how he would come out? 

Simpson: Not at all. Go right ahead. Only let me talk to Bowditch 
first so he won't get worried. 

Bowditch volunteered to come to the employment department 
and have one of the interviewers administer a Clerical Ability 
Test. He obtained the following score : 

Accuracy: Superior. 
Speed: Average. 


General Description of the New Process Rubber Company, Inc. 

The New Process Rubber Company was incorporated in 1900 with 
one small factory building and a daily production of about 200 pairs of 
shoes. The plant was located in the suburban section of a large eastern 
city, thereby assuring a plentiful supply of labor and economical 
transportation facilities. In 1937 the buildings of the factory provided 
a combined floor space of 25 acres and had a daily production capacity 
of 50,000 pairs of footwear. In addition to its footwear production, the 
company manufactured rubber floor tiling, automobile battery boxes, 
coated fabrics, rubber gloves, corsets, radio parts, and other miscellane- 
ous rubber articles. 

Its principal production was footwear, which was divided into three 
classes: (1) heavy protective footwear designed to be worn directly 
against a stockinged foot, such as rubber boots, hunting and sporting 
boots varying in height from knee to hip, or various other laced or 
buckled shoes worn by lumbermen, miners, farmers, fishermen or 
hunters; (2) light protective footwear, designed to be worn over leather 
shoes and comprising standard and heavy work rubbers and gaiters; 
and (3) canvas footwear designed for sport or summer wear, featuring 
particularly shoes with ventilated uppers and comfortable resilient 
soles. The complete list of footwear included 900 different styles, 
which were further subdivided into six major groups: men's, youths', 
boys', women's, misses', and children's, each group containing 14 sizes. 
From the point of view of production, division by styles was of particu- 
lar significance in the factory. Setting up production for each style 
called for many equipment and material changes. Once a particular 
setup had been made, manufacture of different sizes required only 
minor adjustments of the production process. The number of parts in 
a shoe ranged from 13 to 45, so the number of different pieces required 
by the variety of styles, sizes, and colors, was large. 

The company did not manufacture directly for stock but chiefly to 
fill orders from jobbers, chain stores, some large retailers, and its own 
sales branches. Such orders usually came in several months in advance 
— up to 5 or 6 months. On the other hand, some orders were received 
for delivery within three or four weeks if seasonal extremes or other 
causes increased the anticipated demand. These rush orders were 
accepted if they did not unduly disrupt the regular production schedule, 
and they usually required the hiring of new employees. Sometimes, 
to level production, the company manufactured to some extent on 
estimated orders. 



In the manufacture of all three types of footwear, the fundamental 
processes were the same, differing only in detail and consisting in the 
combination of rubber or fabric parts assembled over an aluminium 
last. A brief outline of the company's manufacturing processes is as 

All raw materials, such as rubber, fabric, compounds, etc., were 
subjected to a rigid inspection and laboratory testing upon arrival at the 
plant before their use was approved for any of the company's products. 

The first step in processing consisted in weighing out the various 
ingredients or compounds in designated proportions to be mixed with 
raw rubber. The chemical ingredients or compounds varied according 
to the ultimate use of the finished product. A few of the more common 
compounds were sulphur, essential to vulcanizing; various chemicals 
known as " accelerators," which assisted the process of vulcanizing; and 
coloring pigments, softeners, reinforcing agents, and antioxidants. 
These compounds were mixed with rubber in mixing mills or internal 

The compound gum was then calendered or rolled into sheets of 
desired thickness, having plain or engraved surfaces. This operation 
was performed on heavy machines known as "calenders." Fabrics 
were also rubberized or coated with rubber on fabric calenders. 

Fabric and gum parts were then cut to proper shape on various 
types of cutting machines. 

The cut parts were then run through preparatory assembly opera- 
tions of cementing, fitting, or stitching, in preparation for final assembly 
on aluminium lasts. 

Following the final assembly, all rubber footwear was vulcanized. 
A highly important principle of rubber manufacturing was contained in 
the chemical art of compounding and proper vulcanizing. Certain 
formulas were jealously guarded trade secrets. The duration and 
temperature of vulcanizing affected the resulting product in much the 
same way as baking affects a cake. 

At each stage of the manufacturing process, many precautionary 
measures were taken to detect and eliminate defective material. There 
was a final inspection in the packing department to make sure that only 
the best quality of merchandise reached the customers. 

The organization of the New Process Rubber Company was a 
combination of staff and line. See Chart XXI on page 307. 

Employment management in this concern had grown from a clerical 
function to an important staff activity. This rise in status is reflected 
in the changing terminology connected with organization. We may 
distinguish between four conceptions of employment management that 
are associated with different phases in the company's history. 

1. Employment Activity as a Decentralized Line Function. Up to 
191 6, employment was exclusively a function of line authority. It was 
the foreman's duty to hire and fire and to assume all responsibility for 
such labor relations as placement, training, promotion, and layoff. 
Each department maintained its own employment records independ- 



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ently of all other departments. Employees' records consisted of small 
cards that served as a desk file for the personal use of the foreman. The 
employment procedures were extremely simple. On the one hand there 
were jobs. On the other hand there were unemployed workers. The 
foreman went to the gate and from a chance aggregate of applicants 
filled his requirements. Labor turnover was high. 

2. The Centralized Employment Office. In 191 6 an employment 
manager was put in charge of the newly created employment office. 
His duties were to coordinate the hiring procedures and maintain 
employment records on a plant basis. At this time, not only super- 
visors, but also the employment manager (despite individual intuitive 
insight), looked upon workmen as an undifferentiated labor supply. 
Workmen, as interchangeable units, were lumped together as " hands," 
the "help," etc. Little effort was made to determine personal qualifica- 
tions. As a matter of fact, for quite a few years, foremen continued to 
insist on selecting their own employees. The employment manager and 
his assistants merely kept a record of these hit-or-miss transactions. 

A study made by Professor R. W. Kelly 1 in 191 6 throws some light 
on the employment practices of that time. Questionnaires sent out by 
Professor Kelly, were answered by 30 concerns, of which the New 
Process Rubber Company was one. Only a few of the firms reporting 
had had their employment offices in operation for more than five years. 

The first step in setting up an employment office was the develop- 
ment of various forms for requisitioning help, for application blanks, 
and for termination cards showing the man's ability and reasons for 
leaving. The next step was the maintenance of individual efficiency 
records and daily reports of all men hired and fired from which to 
compile labor turnover statistics. Finally, more elaborate data were 
accumulated, such as tables showing the average age of employees, 
number of married and single men and women, nationality distribution, 
number of citizens and aliens, sickness and accident reports, residence 
distribution, length of service, and employment data with reference to 
separate departments. Table XIV gives a composite of the essential 
information supplied by 30 firms. The respondents were classified in 
two groups: I (1-12) those concerns with a total of 8,225 employees, 
who had no separate employment office; II (13-30) the 18 concerns 
that had an employment office. The total number of employees in 
this group was 47,625. 

3. The Employment Service Department as a Nucleus of Personnel 
Management. At the end of the world war, the term " employment 
manager" was still new in the commercial and industrial world. Only 
a few pioneers had begun to talk and write about the new profession of 
handling men. At this period the employment office was the nucleus of 
the rapidly developing personnel or industrial relations department. 
In an era of welfare activities, the employment manager supervised not 
only customary employment procedures but also various plans that had 

1 R. W. Kelly, "Hiring the Worker," The Engineering Magazine Company, 
New York, 191 8. 



been devised to bolster up the morale of the employees and to enlist 
their cooperation. Such plans included suggestion systems, relief 
association, first aid, and recreational and social activities. 

Table XIV 
Employment Procedures of Thirty Concerns 1 

Number using application blank 

Number claiming an adequate interview with author- 
ity above foreman 

Number claiming to follow up references in a major- 
ity of the cases 

Number giving physical examinations 

Number depending largely on tryout in the shop to 
determine fitness for work 

Number giving mental tests 

Number claiming to have any definite plan of promo- 

Number who make a point of informing employees of 
the opportunities for advancement 

Number having a written analysis of the job 

Number giving foremen or department head full 
power to discharge 

Number providing for transfer and tryout in other 

Number claiming to investigate all cases of discharge. 

Number claiming to investigate a majority of the 
cases of voluntary leaving 

Group I Group II 
























1 (From R. W. Kelly, "Hiring the Worker," New York, 1018.) 

4. The Employment Department as a Subdivision of the Industrial 
Relations Department. With the increasing complexity of labor rela- 
tions, there appeared a division of functions and reorganization of the 
departments that were directly concerned with personnel activities. 
Employment management was recognized as a specialized service and 
as such became a subordinate part of the more comprehensive industrial 
relations department. In the New Process Rubber Company this 
change had definitely taken place by 1930, when a gradual accumulation 
of functions had led to the following staff organization (Chart XXII) . 

The organization chart shows that the employment manager was 
subordinate to the manager of industrial relations, who in turn, reported 
to the vice-president. The employment manager was in a coordinate 
relationship to the other members of the industrial relations manager's 
staff. He was the superior of his own departmental organization, 
which consisted of supervisors in charge of mens' and womens' employ- 
ment and a secretarial as well as a clerical force. The assistants to the 



employment manager were trained interviewers but were also responsi- 
ble for such incidental duties as editing the company magazine and 
supervising loans to employees. The employment manager was left 
free to develop general policies pertaining to employment. 

In 1934, management first attempted to make employment stability 
the foremost consideration in all employment transactions. To this 
end, transfers or promotions from among the employees of the company 
were given consideration prior to any hiring procedure. In 1936, 
95 per cent of all interdepartmental transfers were made for production 
reasons; 4 per cent of such transfers were for the purpose of promotion; 
and 1 per cent were remedial or salvage transfers in which a mal- 






















Chart XXII. — Organization of the industrial relations department at the New 
Process Rubber Company, Inc. 

adjusted employee was shifted from one department to another for a 
fresh start. 

Most of the occupations in the factory were classified as semi-skilled. 
Among men the highest skill was to be found in calendering and cutting; 
among women's jobs the highest skill was in stitching. The semiskilled 
jobs required from four to eight weeks training before an inexperienced 
employee could maintain standard quality of production. 

Much of the work at the factory involved a sharp differentiation 
between men and women. The following departments employed men 

Raw material. 


Washing and drying. 




Scrap and waste. 


Laboratory mill. 

Asphalt products. 

Internal transportation. 

External transportation. 

Other departments such as the following, employed predominantly 


Packing of heavy boots. 


Odd stock. 

Hard rubber and molds. 





There were no departments in which women only were employed, 
but in the following departments, women were in the majority: 

Light footwear (Assembly on a last). 

Canvas footwear (Assembly on a last). 

Stitching (Preparatory Assembly — "Fitting up"). 


Boot assembly. 

Preparatory for winter footwear. 

In general, handling heavy materials or heavy machinery, or work 
entailing exposure to heat or cold, or contact with smelly raw materials, 
was done by men. The types of work in which women predominated 
were the preparation of material for assembly, work on assembly con- 
veyors, and work involving the operation of light machinery, such as 
trimming machines, perforating machines, and power stitching 
machines. Women also packed most of the lighter products and served 
as inspectors in the packing department. 

The wage scale of the company was maintained at a level that was 
above that paid in the community and compared favorably with the 
industry at large. The hourly rated employees worked on an incentive 
plan providing a guaranteed hourly minimum, which varied according 
to the requirements of the job. Time standards were established to 
measure individual output and represented the number of minutes 
allowed for each unit of work. The rate paid for any standard opera- 
tion was called the base rate. Any fully trained employee could 
regularly do the work in less time than standard. A majority of 
employees saved at least one-third of the time. This meant that in 
every hour they exceeded their base rate by 33^-3 per cent. 

New employees assigned to work on standards and on which they 
were inexperienced, were classified as apprentices and placed on a 
training schedule. They started at a hiring (or beginner's) rate of pay, 
which was increased in accordance with a training schedule established 
for the job until the job base rate had been reached. Increases beyond 
the base rate were earned in direct proportion to production. 


New employees on daywork jobs (not on standards) also had a 
training schedule starting with the hiring rate and providing for uniform 
increases up to the established daywork rate. The schedule was spread 
over the number of weeks established as being necessary to train the 
employee. Since daywork jobs offered no opportunity for incentive 
earnings, the daywork rate was higher than a corresponding base rate on 

Every employee assigned to work on standards was paid an allow- 
ance at his regular base rate for idle time that was caused by conditions 
not under his control such as no assignment, no stock, machine break- 
down, etc. He was paid on the same basis for work done for which no 
standard had been established. Special rules had been devised by 
management to govern the allowance for time spent without working 
because of injuries, visits to the hospital for required physical examina- 
tion, time spent on civic duties (jury service or national guard), or time 
spent with investigators and interviewers on affairs outside of regular 
work but in the interest of the company. 

It was the responsibility of the standards department to establish 
and maintain accurate job standards and to supervise the operation of 
the incentive plan. The principal device used to gain these ends was 
motion and time study by means of which members of the standards 
department made every effort to establish correct working procedures. 
Used in this way, primarily for training purposes, motion and time 
study helped to eliminate unnecessary effort and unsafe methods. 
Each employee was enabled to acquire skill and attain full earning 
capacity as quickly as possible. The standards department could 
reexamine the standards of any department without authorization or 
request from a department head to determine if changes had taken 
place in conditions or operations which required new standards. 
Standards for the jobs on which operators were working were available 
to employees at all times. According to the differences in the nature 
of the work or the size of the department, some one of the following 
methods of distributing information as to job standards was used. 

Coupon System. Standards were made available to the employees 
by means of a coupon attached to a specification ticket. A separate 
coupon was used for each operation performed. Each coupon had 
printed on it the number of pairs or units, the standard, and in some 
cases, the total points of work to be done, as well as the base rate of the 
job. The employee, upon completion of the total pairs called for by 
the production ticket, tore off the coupon and kept it to be turned in at 
the end of the day for pay-roll credit. 

Specification Ticket System. This plan consisted of a printed form 
describing the type of footwear to be made and the number of pairs. 
The ticket also bore the operation name and its standard and was 
issued to the operator as a guide to the day's work. This ticket was 
also used for group operations on a conveyor unit. 

Desk or Office File System. It was customary to catalogue standards 
in a loose-leaf binder. The information was then filed in the section 
foremen's office to which the workers had access. 



Poster System. In small departments, where uniform manufactur- 
ing processes were carried on throughout the year, standards were 
posted in a section location where they could easily be referred to by 

Up to 1933 the New Process Rubber Company, Inc. operated as an 
open shop with union membership scattered among certain trades. 












1 Female 

£ 120 







1 80 








i y 

























>v N 



15 20 25 30 35 40 45 50 55 60 65 70 75 
Age in years 

Chart XXIII. — Age distribution of male and female, employees of the New 
Process Rubber Company, Inc., January 1, 1937. 

Since that time the employees have organized an independent union for 
the purpose of collective bargaining with management. 

According to the report of the employment department (Jan. 1, 
x 938) 5 -48 per cent of the employees in the plant were classified as 
Americans. The largest group of foreign born were the Italians (18 per 
cent). Other national groups represented were: Canadian (7 per cent), 
Irish (4 per cent), Polish (4 per cent), Lithuanian (3.2 per cent), and a 
sprinkling of 30 other nationalities. 



Charts XXIII to XXVII give the age distribution of male and female 
employees for 1936 and 1937; the marital distribution of employees: 

15 20 25 30 35 40 45 50 55 60 65 70 75 
Age in years 
Chart XXIV. — Age distribution of male and female employees of the New Process 
Rubber Company, Inc., January 1, 1938. 



CZ] Percent of male employees married 
■S Percent of female employees married 

1927 1928 1929 1930 1931 1934 1935 1936 1937 

Chart XXV. — New Process Rubber Company, Inc., marital distribution of 
employees, 1927-1931; 1934-1937. 

1927-1931, 1934-1937; distribution according to length of service; and 
the residential distribution of employees. 












L E G E N D 

H Per cent of males 
E3 Per cent of females 
□ Per cent of total 

i nn l 


0-I2months l-5years 5yearsandover 0-I2months l-5years 5 years and over 0-I2months l-5years 5yearsandover 
1935 1936 1937 

Chart XXVI. — New Process Rubber Company, Inc., distribution of employees 
according to length of service, 1935-1937. 


Zone A, radius of 1 mile from 


Zone B, radius of 5 miles from 


Zone C, radius of 10 miles from 


Zone D, radius of 15 miles from 



per cent of 


per cent of 




per cent of 



per cent of 

21 .56 

per cent of 

21 .91 

Chart XXVII. — Residential distribution of employees of the New Process Rubber 
Company, Inc., I933"i937- 


General Description or the National Manufacturing 
Company, Inc., Plant No. io 

The National Manufacturing Company, Inc., was a large-scale 
enterprise that was owned by about 43,000 stockholders, each holding, 
on an average, 62 shares. It employed nearly 60,000 men and women 
with an average age of 36 and an average service of 9^ years. The 
headquarters division and the central sales department of this company 
were located in a large Middle Western city. Eleven subsidiary plants 
were scattered throughout the Atlantic states. The products of the 
National Manufacturing Company comprised a wide range of machinery 
and electrical appliances for both producers' and consumers' markets. 
These markets were world wide and highly competitive. In some lines, 
the National Manufacturing Company had to compete with over 
150 manufacturers. 

The plant referred to in the case material of this book (Plant 10) 
was located in a New England city with a population of 100,000 and a 
plentiful supply of skilled labor. It had been in the community for 
30 years and was one of four large concerns in the city that employed 
approximately 4,000 men and women. 

The general policies of the local plant were outlined by the head- 
quarters division of the national organization, while its local policies 
were centralized in its own management. Company organization of 
the local plant was a combination of staff and line as shown in Chart 

As indicated by the chart, the line organization was as follows: five 
divisional superintendents (each in charge of a specific line of products) 
reported directly to the works manager. To them reported depart- 
mental supervisors or general foremen. Each of these, in turn, was 
assisted by 10 or 20 foremen who had authority over the various produc- 
tion and assembly sections. Finally, group leaders were directly in 
charge of individual work units. 

Operations at the local plant were carried on in modern steel and 
concrete buildings and were characterized by straight-line, continuous 
production. There were both overhead conveyor-assembly and bench- 
assembly lines as well as extensive provisions for inspection and quality 
control. All departments were provided with automatic machinery 
and the latest available safety devices. The manufacture of many 
parts involved precise machining and tolerances of 0.0002 to 0.0004 

The products of the local plant were consumers' goods that depended 
on retail sales through the retail and jobbing organization that the 




central sales department had established throughout the world. The 
nature of the business was such that production schedules were sea- 
sonal, and the product was subject to annual changes in design, resulting 
in high peaks of production activity and sharp recessions in its several 
divisions. Chart XXIX showing employment activity at the National 
Manufacturing Company, Inc., Plant No. 10, illustrates this trend. 
Other factors, however, such as business recessions, introduction of new 
























































Chart XXVIII. 

-Plant organization of the National Manufacturing Company, 
Inc., Plant No. 10. 

products, transfer of products to other plants, etc., must be taken into 

Nearly 80 per cent of the employees of plant No. 10 were American 
born. Poles and French Canadians predominated among the male 
foreign born group; Italians among the women. Of the younger 
employees about 60% were the American born children of Polish, 
Italian, and French- Canadian parents. A few of the older unskilled 
and semi-skilled employees could neither read nor write English, but 
most of them had a grammar school education. Skilled workers, such 
as tool and die makers, die setters and repairmen, welders, electricians, 
carpenters and steam fitters, also had a high school or trade school 
education. 90 per cent of the younger group (unskilled, semi-skilled 
and skilled) were high school graduates or at least had several years 
of high school training. 



saa/\0|diu3 p jaqiun^ 



Work was carried on in three shifts which were sub-divided in order 
to facilitate traffic to and from the plant. The following table shows 
the number of employees working on the different shifts on February 18, 


Working Hours 




Lunch period 


6:15 a.m.- 3:00 P.M. 
6:15 a.m.- 2:00 P.M. 

8:15 A.M.- 5:00 P.M. 
7:00 A.M.- 3:00 P.M. 

3 : 00 p.m.-i 1 : 30 p.m. 
2 : 00 p.m.-io: 00 p.m. 
2:00 p.m.-io:oo P.M. 

3:00 P.M.- 9:00 P.M. 

3 : 00 p.m.-i 1 : 00 p.m. 

2:00 P.M.- 2: 15 A.M. 

1 1 : 00 p.m.- 7 : 00 a.m. 
Grand Totals 













10: 15-11:00 
12:30- 1:15 












6:00- 6:30 
6:00- 6:30 
6:00- 6:45 
6:00- 6:45 
6:00- 6:45 


1, us 






2 : 00- 2:15 






Most employees preferred to work on the first shift and transfer 
from the second or third shift was considered as a promotion. Trans- 
fer in the reverse direction was regarded as a demotion. It was 
expected that beginners should start to work on the second or third 
shift. The reasons given for these attitudes were as follows: 

a. Work on the first shift (especially shifts l-a, 1-b, and l-d) left the afternoon 
free for leisure-time activity. 

b. The first shift represented the working shift of the plant and carried on maxi- 
mum production. 

c. Workers on the first shift came in frequent contact with higher supervision, 
while workers on the other shifts had few such opportunities. 

d. Opportunities for promotion occurred mostly on the first shift. 

e. During periods of layoff, the second and third shifts were often abolished. 
/. Most highly skilled and long-service employees worked on the first shift. 

There was no extra compensation for working on the night shifts. 
All operators were on group piecework. They received guaranteed 
base rates plus incentive earnings, which were determined by the 
productivity of each group. Base rates were established by a schedule 
that set up a wage scale for all occupations in the plant and governed 
the range of pay by occupations in each division. The graph on p. 320 
indicates the basic wage scale and shows the percentage of workers in 
each major occupational grouping. 

Separating the men and women who were employed in the factory 
and classifying them according to differences in skill, we get the picture 
shown on p. 321. 



50 r 







Laborers Carpenters Class B Tool and die makers 

Repetitive assembly Tinsmiths Class B Jig borers 
Material handlers Millwrights Class B Radial drill 

Packer, loader Assembler Electrician lst.Class 

Snaggers Spot welder Millwright lst.Class 

Washers Milling machine Engine and turret lathes 

Trade helpers Engine lathe Class B Pattern makers 

Class C Testers Class B Testers Class A Testers 

and inspectors (f) and inspectors (f) andinspectors(f) 

Janitress(f) Connector(f) Winders (f) 

Chart XXX. — National Manufacturing Company, Inc., Plant No. io; dis- 
tribution of all factory employees (male and female) according to differences in 
skill. Population data, June, 1937. Total number of employees, 5,123. 







Unskilled Semi-skilled Skilled 

42.6% 32.6% 24.8% 

Chart XXXI. — National Manufacturing Company, Inc., Plant No. 10; dis- 
tribution of male factory employees according to differences in skill. Population 
data, June, 1937. Total number of employees (M), 4,038. 

60 """ 






Unskilled Semi-skilled Skilled 

61.5% 17.5% 20.9% 

t Chart XXXII. — National Manufacturing Company, Inc., Plant No. 10; dis- 
tribution of female factory employees according to differences in skill. Population 
data, June, 1937. Total number of employees (F), 1,085. 



The high percentage of skilled women is somewhat unusual and 
refers to the presence of a group of 180 skilled winders. 

The function of the industrial relations department was (i) to 
guide management in the formation and interpretation of policy as 
related to labor relations; and (2) to assist in the application of com- 
pany policy after it had been established. 

The following chart shows the organization of the Industrial 
Relations Department and the subdivision of its various activities. 






Apprentice training. 
Group leader 

Foreman training. 

Employee selection, 
Labor law control. 






Employee safety 
health and 


Accident records 
and statistics . 



Medical examination 
and first aid. 







Male employment. 
Sick benefit 

and insurance. 
Rate card 



Policy book 




Female employment. 
Office employment. 




Chart XXXIII. — Organization of the industrial relations department of the 
National Manufacturing Company, Inc., Plant No. 10. 










Accident hazard in punch press depart- 
ment 211 
Accidents, prevention of 211— 219 
Advertising as source of labor supply 19 
Age distribution of employees at the New- 
Process Rubber Company, Inc. 313-314 
Applicants for work, ratio of applications 

and number of individuals hired 20 

rejection of, elimination of the obvi- 
ously unfit and doubtful cases 19 
types of 18-19 
Apprentice system of training 133 
Attendance records 106, 171-182 


"Boys' " jobs 

Budget as element in cost control 

College men, employment of 
Company houses 
Compensation for accidents 
Continuous service allowance 
Cost control 
Cumulative service 

Defective workmanship, campaign 

against 253-268 

Demoted foreman, difficulties of 293-297 

Demoted group leader, difficulties of 285-288 
Demotion, transfers of 

57, 58, 65-67, 125-127 

Depression, effect on training program 139 

Discharge 121-131 

arbitrary 13, 121- 122 

changing trends in foremen's attitude 

toward 121— 124 

foreman's power of 121, 254 

statistical analysis of causes of 122-124 

Discrimination, complaints of 

38, 44, 117-120, 154, 280 
Distribution of work 70, 187 


Education of employees at the National 
Manufacturing Company, Inc., 
Plant No. 10 317 

Employee activity at the National Manu- 
facturing Company, Inc., Plant 
No. 10 318 

Employee rating 99-107 

conflict with employment stabilization 88 
differences in procedure of 99-101 

difficulty of interpreting factors in 102 

sheet 106 

sheet, access to 105 

Employee reaction toward penalties for 

defective work 256 

Employee recreation 31-32 

Employee Representation Plan 183, 255 

Employment, advertising as a means for 

securing applicants 19 

application file 21 

of college men 37~39 

interview 18-21 

introduction card system of 18-19 

final interview 20-21 

of married women 41-44, 51-53. 202 

of relatives 45-48, 69-71. 74 

sample letters of applicants for 21-26 

Employment department at the New 
Process Rubber Company, Inc., or- 
ganization of 309-310 
Employment management at the New 

Process Rubber Company, Inc. 306-309 
Employment requisition, form used at the 

New Process Rubber Company, Inc. 27 

Employment stabilization 59, 77~88 

conflict with rating system 88 

Factory work, differentiation between 

male and female 3 10-31 1 

Family as a factor in rehiring 51-56 

Favoritism under piecework 187 

Finance companies, 3 per cent per month 

195-196, 202 
First aid department 241-242 

Flow of work, interuptions in 85 

Foreman, having power of discharge 121, 254 
as leader 14-15, 299-303 

new type of 89 

old type of 27-29, 89 

as representative of management 188 

worker, teacher-pupil relationship, dif- 
ferences between 135 
Foremen, and arbitrary discharge 13, 121-122 
and management systems 7-8, 101-102 
Foremen training 7-8, 12, 146-150 
Foremen's attitude, toward general in- 
spirational courses 146 
toward hypothetical case material 147 
toward suggestion system 233 
toward transfer of employees 82—84 

Group discussions in foremen training 

8, 148-150 
Group leader, difficulties of a demoted 

not a representative of management 

Group-leader plan 187-190 


Hidden pensions 
Hours of work 


Incompetence as a cause of discharge 122-124 
Industrial Accident Board 245-246 

Industrial relations department, at the 
National Manufacturing Company, 
Inc., organization of 322 

at the New Process Rubber Company, 

Inc., organization of 310 


3 2 4 


Industrial safety 21 1-2 19 

Installment purchases by employees 

. . ,. , . 74-75. 202 

Interviewing applicants for work 18-19 

Job proprietorship, sense of 80-81 

Job security endangered by transfer 93-97 
Job standards 312 


Labor supply, sources of 18-21 

Labor turnover at the New Process Rub- 
ber Company, Inc. 77~78, 85 

"Lame-back" case 241-252 

Layoff, cases involving 

Case 8 51-53 

Case 9 55-56 

Case 11 65-67 

Case 13 73-75 

Case 14 77-88 

Case 15 89-91 

Case 16 93-97 

Case 17 99-107 

Case 18 ioo-iii 

Case 19 113-115 

Case 20 1 17-120 

Case 25 153-156 

Case 33 205-209 

Case 41 269-276 

Case 42 277-284 

Case 44 289-292 

Case 46 299-303 

effect on service record 152 

and employee status 93~97 

notice of 105 

order of 104-105 

preliminary steps in 93 

procedure of 99-107 

Length of service, as a criterion in re- 
hiring 49 
distribution of employees at the New 
Process Rubber Company, Inc. 
according to 315 
diversity of practice in calculating 151-152 
New Process Rubber Company, 

method of computing < 153-156 

Line supervisors, social differentiation of 


Loans to employees 195-204 


Maladjusted employees 

65-67, 73-75, 135, 138 
rehabilitation of 237-240 

Manufacturing processes at the New 

Process Rubber Company, Inc. 306 

Marginal employees, definition of I04n. 

Marital distribution of employees at the 

New Process Rubber Company, Inc. 314 
Married women in industry 41-44, 51-53, 202 
Misconduct, as a cause of discharge 122-124 
regulations governing 103 

Morale 189, 293 

Motion study as an aid to employee 

training 136 


National Industrial Recovery Act 41, 153 
Nationality of employees at the National 
Manufacturing Company, Inc., 
Plant No. 10 253, 317 

at the New Process Rubber Company, 

Inc. 313 

Need for employment as a criterion in 

hiring 34 

in rehiring 49, 51-53, 55 

Office versus shop workers 

11-12, 109— in, 289-292 
Older workers 205-209, 283 

Organization charts 254, 307, 310, 317, 322 

Pay guarantees 84 

Penalties for defective work 256 

Pensions 205-209 

Personal preoccupations of employees 

277-284, 285-288, 289-292, 293-297, 301 
Politics and business 33~35 

Positive Safety Guard 21 1-2 19 

Preferential treatment, long service em- 
ployee's request for 45-48, 280-292 
Production transfers _ 59, 77-97 
Promotion, group leader's position as 

stepping stone to 188 

guided by employee rating 104-105 

informal differences in social status as a 

basis of 58 

of office boys 65 

transfers 57. 61-63, 3 19 

Promotional jobs 37~39, 138-143, 188 

Public employment bureau as source of 

labor supply 19 

Quality standards, foremen's different 

interpretations of 102 

Rating sheet, for attendants, old form 142 
new form 145 

as a means of doing follow-up work 

with employees 99-100 

procedure 99-100 

Rehiring, continuous service allowances 

in 153-156 

criteria used in 49 

Relatives, employment of 

28, 45-48, 60-71, 74 
Remedial transfers _ 58, 69-71, 73~75 

Residence as a criterion, in hiring 33 

in rehiring 40-50, 52 

Residential distribution of employees at 
the New Process Rubber Company, 
Inc. 315 

Routine records as an objective basis for 

rating employees 107 

Safety patrol 211 

Seasonal unemployment 73-75, 77~78, 109 
Security of employment 84 

Seniority 113-115, 117-120, 280-292 

Shift preference 43-44, 280, 280-292, 319 

Shifts, distribution of workers on the 

different 319 

Shop versus office workers 

11-12, ioo-iii, 280-292 
Sickness absences, salary allowance 

during 1 71-182 

Sit-down strike, threat of 224 

Skill, differentiation of employees at the 

National Manufacturing Company, 

Inc. according to differences in 320-321 
Social differentiation, of line supervisors 

of staff officers 11-12 

Social Security Legislation 206-209 

Social status, informal differences in 58 

Stabilization of employment . 59, 77~88 

State Unemployment Compensation Act 205 



Striker and nonstriker, relationship be- 
tween 129-131 
Style problem in rubber industry 

79, 135, 20s, 305 
Suggestions from employees 227-233, 278-280 
Surty Manufacturing Company, Inc. 

213, 215, 217 

Union cooperation, in bringing back work 

that had been sent outside 269-276 

in campaign against waste 253-268 

in reducing excessive factory costs 275-276 
United Electrical and Radio Workers of 

America 183 

Unreliability as a cause of discharge 122-124 

Teaching schedules and instruction costs 137 
Technical organization of industry 9-10 

see also Organization charts 

Termination payments 206 

Time study, problems of 271, 274 

Training, apprentice system of 133 

difficulties under piece work 187 

for foremen 7-8, 12, 146-150 

potential supervisors 138-146 

teaching on the job by staff men 136-138 

for versatility 78-84 

vestibule era 134-136 

Transfer, as danger to job security 93~97 

of demotion 57, 58, 65-67, 125-127 

of employees 58-97, 299-303, 310 

a function of management 58-59 

of promotion 57, 61-63, 319 

of production 59, 77-97 

remedial 58, 69-71, 73~75 


Unemployment, seasonal 73-75, 77-78, 109 
Unemployment insurance 206-209 

Union attitude toward Positive Safety 

Device 216-218 

Vacation policy at the National Manu- 
facturing Company, Inc. 235-236 
Versatility, training for 78-84 
Vestibule school training, difficulties with 

Veteran employees, organization for 235-236 


Wage administration at the New Process 
Rubber Company, Inc. 

163-190, 311-312 
Wage attachments, policy of handling 

as a cause of discharge 191 

individual cases of 73~74, 114-115 

Wage scale at the National Manufactur- 
ing Company, Inc., Plant No. 10 320 
Wages, differentials in 163-169,, 183-186, 320 
rate structure among electricians 169 

Walsh-Healey Act 29 

Waste, campaign against 253-268 

Welfare department and employment 51-52 
Women, hours of employment for 41 

married, in industry 41-44, 51-53, 202 

objections to work on the afternoon 

shift 43-44 

Working conditions 221-226 

Date Due 
Due Returned Due Returned 

G, 'JL, 


Social problems in labor relat main 

3 lEbE D31bD 0207 

I ' • ■..'.*, -ft.- 


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